What is the cure period if Lees Famous Recipe breaches the Trademark License Agreement?
Lees_Famous_Recipe Franchise · 2025 FDDAnswer from 2025 FDD Document
The Marks are owned by our Parent, which has granted us a license to use and license franchisees to use the marks effective June 21, 2021 (the "Trademark License Agreement"). The Trademark License Agreement is effective indefinitely unless terminated at the option of either party. Our Parent may terminate the Trademark License Agreement if our misuse of the Marks materially impairs the goodwill associated with the Marks, if we violate any of our Parent's instructions concerning the quality of the Marks, or if we fail to perform any other obligation under the Trademark License Agreement, and we fail to cure such breach within 30 days. If the Trademark License Agreement terminates, any then-existing sublicenses (franchises) will automatically be assigned to our Parent and will continue for the term of the sublicenses, provided that the franchisees comply with all other terms of their Franchise Agreements. The Trademark License Agreement contains no other material limitations.
Source: Item 13 — TRADEMARKS (FDD pages 50–52)
What This Means (2025 FDD)
According to Lees Famous Recipe's 2025 Franchise Disclosure Document, the Trademark License Agreement between Lees Famous Recipe and its parent company remains effective indefinitely unless terminated by either party. If Lees Famous Recipe fails to meet its obligations under this agreement, the parent company can terminate the agreement, but only if Lees Famous Recipe fails to correct the breach within 30 days.
This 30-day cure period is a standard practice in franchising, providing Lees Famous Recipe with an opportunity to rectify any issues before facing termination of the Trademark License Agreement. This agreement is crucial because it grants Lees Famous Recipe the right to use and sublicense the brand's trademarks to its franchisees.
If the Trademark License Agreement is terminated, the existing franchise agreements (sublicenses) will be automatically transferred to Lees Famous Recipe's parent company. These franchise agreements will continue under the original terms, provided the franchisees comply with all other terms of their Franchise Agreements. This ensures continuity for franchisees even if the agreement between Lees Famous Recipe and its parent company ends.