Intellectual Property licences And Sub-licences

It's not uncommon for a company that owns intellectual property (IP) such as trade marks, patents and copyright to grant another company the right to use that IP. The grant of the right to use IP is referred to as a ‘licence', the company that grants the right is referred to as the ‘licensor', and the company that gets the right is referred to as the  ‘licensee'.  It's also not uncommon for the licence to provide that the licensee will itself be entitled to grant licences to use the IP. These further licences are referred to as ‘sub-licences', and the further licensees as ‘sub-licensees'.  You'll see this quite often in franchise arrangements, or in situations where the owner of IP is trying to establish itself in a foreign country. But what happens to a sub-licence if the initial, main licence is cancelled? The answer is - as is so often the case - it depends!