What happens if the Pump It Up franchisee violates the software license provisions?

Franchisee understands and acknowledges that the Software contains Franchisor's trade secrets and agrees, during the term of this Software License and thereafter, not to communicate, divulge or use the Software other than in the operation of the System by Franchisee and its employees.

Franchisee shall divulge and allow access to the Software only to those of its employees who must have access to it in connection with their employment in the System.

At Franchisor's request, Franchisee shall require and obtain execution of covenants concerning the confidentiality of the Software from any persons employed by Franchisee who have access to the Software.

These covenants shall be in a form substantially similar to the confidentiality covenants contained in Section 18 of the Franchise Agreement.

Franchisee shall exercise reasonable precautions, no less rigorous than those Franchisee uses to protect its own Confidential Information, to protect the confidentiality of the Software and the user and operating manuals thereto, which precautions shall include, at a minimum, giving instructions to Franchisee's employees who will have access to the Software and the user and operating manuals thereto that the same are proprietary to, and the trade secrets of, Franchisor or such third parties.

Franchisee shall not remove or alter any designations that Franchisor or such third parties have included in the Software and the user and operating manuals thereto that indicate such material is the proprietary property of Franchisor or such third parties.

Franchisee agrees to notify Franchisor immediately of the existence of any unauthorized knowledge, possession or use of the Software or of any part thereof.

Franchisee acknowledges and agrees that the Software and user and operating manuals thereto are the valuable property and trade secrets of Franchisor or other authorized parties, that any violation by Franchisee of the provisions of this Software License would cause Franchisor or such other parties irreparable injury for which they would have no adequate remedy at law, and that, in addition to any other remedies which Franchisor may have, it shall be entitled to preliminary and other injunctive relief against any such violation.

The term of this Software License shall be co-extensive with the term of the Franchise Agreement.

Expiration or termination of the Franchise Agreement for whatever reason shall automatically terminate this Software License and the right granted by it to use the Software, without notice to Franchisee.

If Franchisor's license to any of the Software secured from third parties should terminate, then this Software License shall automatically terminate as to such Software and Franchisee shall comply with the provisions of Paragraph 11 in connection with such Software.

In addition, Franchisor may terminate this Software License upon the failure by Franchisee to comply with any of the terms and conditions herein, by giving Franchisee written notice of termination stating the nature of the breach at least seven days prior to the effective date of termination; provided that Franchisee may avoid termination by immediately initiating a remedy to cure such default and curing it to Franchisor's satisfaction within the seven day period and by promptly providing proof thereof to Franchisor.

If any such default is not cured within that time, or such longer period as applicable law may require, this Software License shall terminate without further notice to Franchisee effective immediately upon expiration of the seven-day cure period or such longer period as applicable law may require.

Upon the expiration or termination of this Software License or upon the expiration or termination of the Franchise Agreement, whichever shall occur earlier, Franchisee shall immediately cease to use the Software and shall immediately deliver to Franchisor all copies of the Software then in Franchisee's possession or control and erase the Software from Franchisee's computer system.

In addition to any other rights which Franchisor may have under the Franchise Agreement or herein, or as Franchisor may otherwise have at law or in equity, in the event Franchisee is in breach of the Franchise Agreement or this Agreement and so long as such breach continues and is not cured to Franchisor's satisfaction, Franchisor shall have the right to disable the Software and to restrict, limit, and/or deny Franchisee access to any computer software or database (including remote software and databases) owned, licensed, operated or controlled (directly or indirectly) by Franchisor or its affiliates, which software or database is used, accessed by or through, or functions in connection with the Software, without prior notice or liability to Franchisee and third parties.

Source: Item 23 — RECEIPTS (FDD pages 60–225)