Upon termination of an Afuri Ramen Dumpling franchise, what happens to the signage?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
, the parties must agree upon a purchase price and terms within 5 business days after termination of this Agreement. If not, a fair value and fair terms will be determined by appraisal as provided in section 7.6 (entitled "Appraisals").
- 6.5.7 Upon termination for any reason, you will return to us all proprietary and confidential materials, including customer lists and account information, keys, codes, signage, advertising and marketing materials, service agreements and other forms, printed files, security codes, and additional similar items and information as may be described in the Operations Manual. If you fail to return or cease use of any of these items, we may enter your business premises without being guilty of trespass or any other tort to remove and retain the items. You will pay to us, on demand, any expenses we incur in trying to remove or collect such items or in attempting to have you cease use of them.
- 6.5.8 Damages and Liquidated Damages. Upon termination pursuant to any default by Franchisee, Franchisee agrees to pay Afuri all actual and consequential damages and any costs and expenses (including reasonable attorneys' fees) incurred by Afuri as a result of such default and termination.
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, upon termination of the franchise agreement, the franchisee is required to return all signage to Afuri Ramen Dumpling. Specifically, the franchisee must return all proprietary and confidential materials, which includes signage, advertising, and marketing materials. If the franchisee fails to return or cease use of the signage, Afuri Ramen Dumpling has the right to enter the business premises to remove and retain these items without being considered a trespasser. The franchisee is also responsible for covering any expenses Afuri Ramen Dumpling incurs while trying to remove or collect the items, or in attempting to have the franchisee cease using them.
Additionally, in the event of termination, expiration, or non-renewal of the lease agreement, the franchisee (referred to as the Tenant in the lease agreement) may be required to de-identify the franchise premises. If the franchisee fails to do so, the landlord gives Afuri Ramen Dumpling the express right to de-identify the premises. De-identification includes the removal of all signs, modification or remodeling of identifying architectural features, repainting to eliminate the franchisor's cooler scheme, and any other steps necessary to distinguish the location from Afuri Ramen Dumpling's proprietary designs and marks.
This means that a franchisee needs to be aware of the costs associated with removing and returning the signage, as well as the potential for Afuri Ramen Dumpling to enter the premises to remove the signage if the franchisee does not comply. Furthermore, the franchisee is responsible for the costs incurred by Afuri Ramen Dumpling to remove the signage. The franchisee must also be prepared to alter the premises to remove any identifying features of the Afuri Ramen Dumpling brand, which could involve additional expenses for remodeling and repainting.