What constitutes an 'Affiliate' of the All States M.E.D. Franchisor?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
NOW, THEREFORE, Franchisor and Franchisee, intending to be legally bound, agree as follows:
1. DEFINITIONS
Whenever used in this Agreement, the following words and terms have the following meanings:
- "Affiliate" means any business entity that controls, is controlled by, or is under common control with Franchisor;
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, an 'Affiliate' is defined as any business entity that either controls the Franchisor, is controlled by the Franchisor, or is under common control with the Franchisor.
This definition is important for prospective franchisees because it clarifies the scope of entities that are related to All States M.E.D. Franchising, LLC. Understanding the definition of 'Affiliate' can be crucial for various aspects of the franchise agreement, including potential liabilities, obligations, and competitive restrictions. For instance, the term 'Competitive Business' excludes businesses operated by the franchisee under an agreement with All States M.E.D. or businesses where the franchisee has a minor (less than 5%) interest in a publicly-held entity. However, this exclusion does not extend to businesses affiliated with All States M.E.D.
Furthermore, the definition of 'Affiliate' is relevant in the context of termination. Upon termination of the franchise agreement, the franchisee is obligated to pay all sums owing to All States M.E.D. and any of its affiliates. This could include damages, costs, expenses, unpaid royalty fees, and any other amounts due. Therefore, understanding the scope of 'Affiliate' helps franchisees recognize the full extent of their financial obligations and potential liabilities under the franchise agreement.