What happens to Itan franchisee sublicenses if the Intellectual Property License Agreement between Itan and Gold Mark is terminated?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
In May of 2008 we entered into an Intellectual Property License Agreement with Gold Mark (the "License Agreement"). Under the terms of the License Agreement, Gold Mark granted us the right to use the Marks in the iTAN System and sublicense the Marks to our franchisees. The term of the License Agreement automatically renews annually, unless it is terminated in accordance with its terms. Gold Mark is permitted to terminate the License Agreement only if we: (a) declare bankruptcy or become insolvent; or (b) consent to the termination. If
the License Agreement is terminated, it states all sublicenses granted by us to our franchisees will continue in full force and effect until the expiration or termination of the applicable franchise agreement. No other agreements limit our right to use or sublicense use of the Marks.
Source: Item 13 — TRADEMARKS (FDD pages 33–35)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, if the Intellectual Property License Agreement between Itan and Gold Mark is terminated, all sublicenses granted by Itan to its franchisees will continue in full force and effect until the expiration or termination of the applicable franchise agreement.
This means that even if the agreement between Itan and Gold Mark ends, franchisees can continue using the licensed trademarks under the terms of their existing franchise agreements. This provides a level of security for franchisees, as their right to use the Itan trademarks is protected for the duration of their franchise agreement, regardless of the relationship between Itan and Gold Mark.
This arrangement is beneficial for Itan franchisees because it ensures business continuity and protects their investment in the franchise. Franchisees can operate without the immediate worry of losing the right to use the brand's trademarks if the agreement between Itan and Gold Mark were to end. However, it is important for prospective franchisees to understand the conditions under which Gold Mark can terminate the License Agreement, which include Itan declaring bankruptcy or becoming insolvent, or Itan consenting to the termination.