After my exclusive rights expire under the Alloy Area Development Agreement, what rights does Alloy have?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition, when you have signed a lease for the last Facility to be developed within the Development Territory, your exclusive rights under the Area Development Agreement with respect to the Development Territory will have expired and we and our affiliates will have the right to operate and to grant to others development rights and franchises to develop and operate Facilities within the Development Territory. This right will be subject only to the territorial rights under your franchise agreements for Facilities in the Development Territory. The Development Territory may not be altered unless we and you mutually agree to do so. It will not be affected by your sales volume. You are not granted any other option, right of first refusal or similar right to acquire additional Facilities in your Development Territory under the Area Development Agreement, except as described above.
Source: Item 12 — TERRITORY (FDD pages 42–46)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, once you've signed a lease for the final Alloy Facility to be developed within your Development Territory, your exclusive rights under the Area Development Agreement expire. At that point, Alloy and its affiliates gain the right to operate and grant development rights and franchises to others for Alloy Facilities within your Development Territory.
This right is only subject to the territorial rights granted under your existing franchise agreements for the Alloy Facilities you already operate in the Development Territory. The Development Territory itself cannot be altered unless you and Alloy mutually agree to do so, and your sales volume will not affect it.
Essentially, after fulfilling your development obligations, Alloy can then expand within your former exclusive territory by opening corporate locations or selling additional franchises, potentially creating competition for your existing Alloy businesses. You do not receive any option or right of first refusal to acquire additional Alloy Facilities in your Development Territory under the Area Development Agreement, except for the territorial rights under your franchise agreements.