What must a franchisee do to be granted potential development rights for a 7 Brew franchise under this Rider?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
ement may not be modified except in writing with the prior approval of an officer of each of Franchisee and Franchisor. Name: Title: Date: Address: Phone/Email:
Director
Check the following that apply:
Owner Senior Personnel Officer Other (please specify)
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EXHIBIT B
DEVELOPMENT RIGHTS RIDER TO FRANCHISE AGREEMENT
DEVELOPMENT RIGHTS RIDER TO BREW CULTURE FRANCHISE, LLC FRANCHISE AGREEMENT
- Background. This Development Rights Rider (the "Rider") is made between BREW CULTURE FRANCHISE, LLC ("we," "us," or "our") and _____________________ ("you" or "your"). This Rider is attached to, and intended to be a part of, the Franchise Agreement that we and you are signing concurrently with signing this Rider (the "First Franchise Agreement") for your construction, development, and operation of your first traditional 7 BREW Store (defined below) at a location to be specified within the Territory (defined below). We and you are signing this Rider because you want the right to construct, develop, and operate additional traditional 7 BREW Stores within the Territory (besides the Store covered by the First Franchise Agreement) over a certain time period, and we are willing to grant you those development rights if you comply with this Rider.
2. Grant of Development Rights.
(a) Subject to your strict compliance with this Rider, we grant you (and your "Approved Affiliates," a term defined in Section 3(a) below) the exclusive right to construct, develop, and operate—according to the mandatory development schedule described in Exhibit A to this Rider (the "Schedule")—<insert number (__)> "traditional" 7 BREW Stores (including the traditional 7 BREW Store covered by the First Franchise Agreement) at locations that are within a two (2)-mile radius of each of the coordinate locations shown on the table attached to this Rider as Exhibit B (each coordinate location and the two (2)-mile radius surrounding it are referred to collectively as the "Territory").1 Each traditional 7 BREW Store you construct and develop must be within the Territory.
A "traditional" 7 BREW Store ("Traditional 7 BREW Store") is defined to mean a freestanding or other facility that has at least one drive-thru window. Any 7 BREW Store that does not, or would not, have at least one drive-thru window is considered to be a "Non-Traditional 7 BREW Store." You have no right under this Rider to construct, develop, and operate Non-Traditional 7 BREW Stores. Your exclusive right under this Rider to construct, develop, and operate 7 BREW Stores physically located within the Territory relates solely to Traditional 7 BREW Stores.
All references in this Rider to a 7 BREW Store without any other descriptor (i.e., without "Traditional" or "Non-Traditional" preceding it) mean any type of 7 BREW Store, regardless of its classification as a "Traditional" or "Non-Traditional" 7 BREW Store.
If we permit you or your Approved Affiliate to construct, develop, and operate a Non-Traditional 7 BREW Store physically located in the Territory—although we have no obligation to do so—it will not count toward your compliance with the Schedule. Only Traditional 7 BREW Stores count toward your compliance with the Schedule.
1 NTD: This two (2)-mile radius of protected territory will be in place for MSAs ranked 40 and above. For MSAs ranked below 40, the protected territory will be one and one-half (1.5) miles.
- (b) We (and our affiliates) reserve the unrestricted right to construct, develop, and operate, and to allow other franchisees or licensees to construct, develop, and operate, Non-Traditional 7 BREW Stores physically located in the Territory. Our, our affiliate's, or another franchisee's or licensee's construction, development, and operation of a Non-Traditional 7 BREW Store physically located within the Territory will not count toward your compliance with the Schedule.
- (c) Your location exclusivity in the Territory for Traditional 7 BREW Stores is the only restriction on our (and our affiliates') activities within the Territory during this Rider's term. We and our affiliates have the right to engage, and to grant others the right to engage, in any other activities of any nature whatsoever within the Territory, including, without limitation, all of the activities in which we reserve the right to engage in the First Franchise Agreement. After this Rider expires or is terminated (regardless of the reason for termination), we and our affiliates have the right, without any restrictions whatsoever, to (a) construct, develop, and operate, and to grant others the right to construct, develop, and operate, Traditional 7 BREW Stores physically located in the Territory (except within the Area of Protection surrounding each of your Traditional 7 BREW Stores) and (b) continue to engage, and to grant others the right to engage, in any other activities we (and our affiliates) desire within the Territory.
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, a franchisee seeking development rights must first sign a Development Rights Rider along with their initial Franchise Agreement. This grants the franchisee the exclusive right to develop a specified number of traditional 7 Brew stores within a defined territory, typically a two-mile radius around coordinate locations listed in Exhibit B of the Rider. However, these rights are contingent upon strict compliance with the Rider's terms.
To maintain these development rights, the franchisee (or their Approved Affiliates) must adhere to the development schedule outlined in Exhibit A, constructing and opening the agreed-upon minimum number of 7 Brew stores within the territory by the specified deadlines. The franchisee is responsible for locating, evaluating, selecting, and securing the site for each store, subject to 7 Brew's approval based on their then-current criteria, including population density, visibility, traffic flow, and other characteristics. The franchisee must submit a separate application for each store and provide all requested information and materials for site assessment.
Furthermore, the franchisee must pay a Development Fee upon signing the Rider, which is non-refundable and covers the rights granted and the reservation of the territory. This fee consists of the $35,000 initial franchise fee for the first store, plus $10,000 for each additional store the franchisee commits to developing. The franchisee must also sign 7 Brew's current form of franchise agreement for each additional store, which may have terms that differ from the initial agreement. Non-compliance with the development schedule or other terms of the Rider can lead to termination of the development rights, although it does not affect existing franchise agreements.