What is the Apricot Lane franchisee advised to do regarding the legal, financial, and other aspects of the agreement?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE AGREES THAT, FOR THE APRICOT LANE FRANCHISE SYSTEM TO FUNCTION PROPERLY, FRANCHISOR SHOULD NOT BE BURDENED WITH THE COSTS OF LITIGATING SYSTEM-WIDE DISPUTES. ACCORDINGLY, ANY DISAGREEMENT BETWEEN FRANCHISEE AND FRANCHISOR SHALL BE CONSIDERED UNIQUE AS TO ITS FACTS AND SHALL NOT BE BROUGHT AS A CLASS ACTION, AND FRANCHISEE WAIVES ANY RIGHT TO PROCEED AGAINST FRANCHISOR OR ANY OF ITS SHAREHOLDERS, MEMBERS, MANAGERS, AFFILATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS BY WAY OF CLASS ACTION, OR BY WAY OF A MULTI-PLAINTIFF, CONSOLIDATED OR COLLECTIVE ACTION. IN ANY LEGAL ACTION BETWEEN THE PARTIES, THE COURT SHALL NOT BE PRECLUDED FROM MAKING ITS OWN INDEPENDENT DETERMINATION OF THE ISSUES IN QUESTION, NOTWITHSTANDING THE SIMILARITY OF ISSUES IN ANY OTHER LEGAL ACTION INVOLVING FRANCHISOR AND ANY OTHER FRANCHISEE, AND EACH PARTY WAIVES THE RIGHT TO CLAIM THAT A PRIOR DISPOSITION OF THE SAME OR SIMILAR PRECLUDES SUCH INDEPENDENT DETEMINIATON.
EXCEPT FOR CLAIMS ARISING FROM FRANCHISEE'S NON-PAYMENT OR UNDERPAYMENT OF AMOUNTS THAT FRANCHISEE OWES FRANCHISOR, ALL CLAIMS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE RELATIONSHIP BETWEEN FRANCHISOR AND FRANCHISEE WILL BE BARRED UNLESS MEDIATION OR JUDICIAL PROCEEDING IS COMMENCED IN THE APPROPRIATE FORUM WITHIN EIGHTEEN (18) MONTHS FROM THE DATE ON WHICH THE PARTY ASSERTING THE CLAIM KNEW OR SHOULD HAVE KNOWN OF THE FACTS GIVING RISE TO THE CLAIM.
Whenever this Agreement requires the prior approval or consent of FRANCHISOR, FRANCHISEE shall make a timely written request to FRANCHISOR therefore, and, except as otherwise provided herein, any approval or consent granted must be in writing to be binding upon FRANCHISOR.
Franchisee shall procure and maintain in accordance with Section 10 such insurance policies in connection with the E-Commerce Platform as Franchisor may require from time to time and shall indemnify Franchisor, in accordance with Section 21C, for any liabilities, obligations and expenses incurred by Franchisor in connection with the E-Commerce Platform, including any liability, obligation or expense arising under the Provider Contracts.
Associate therefore agrees that other than the Franchise Business licensed under a Franchise Agreement, the Associate, will not during the Term and renewal Term of the Franchise Agreement:
(a) Have any direct or indirect controlling interest as a disclosed or beneficial owner in a Competitive Business; or
(b) Perform services as a director, partner, officer, manager, employee, consultant, representative, agent or otherwise for a Competitive Business; or
(c) Divert or attempt to divert any business related to, or any customer or account of the Franchised Business, the Franchisor's business, the business of any affiliate of the Franchisor or any other franchisee's business, by direct inducement or otherwise, or divert or attempt to divert the employment of any employee of Franchisor or another franchisee licensed by Franchisor, to any Competitive Business by any direct inducement or otherwise; or
(d) Without the Franchisor's express written permission, which may be granted or denied in the Franchisor's sole discretion, become an exclusive distributor for any third-party vendor or obtain exclusive distribution rights for any non-APRICOT LANE Products.
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- Post-Termination Covenant Not to Compete. Upon termination or expiration of the Franchise Agreement for any reason, or termination of Associate's employment with Franchisee, Associate agrees that, for a period of two (2) years commencing on the effective date of termination or expiration of the Franchise Agreement, or termination of Associate's employment with Franchisee, or the date on which Associate or the Franchisee, ceases to conduct business, whichever is later, the Associate will not have any direct or indirect interest (through any immediate family member of Associate or its owners or otherwise)
FRANCHISEE acknowledges that because complete and detailed uniformity under many varying conditions may not be possible or practical, FRANCHISOR specifically reserves the right and privilege, in its sole discretion and as it may deem appropriate or necessary, to vary standards for any franchisee(s) or particular circumstance. FRANCHISOR is not required to disclose or grant to FRANCHISEE a like or similar variation hereunder.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
Based on the 2025 Apricot Lane Franchise Disclosure Document, franchisees are advised to adhere to several key provisions regarding the legal and financial aspects of their agreement. Franchisees must provide timely written requests for any required approvals or consents from Apricot Lane, and any approval or consent must be in writing to be binding upon Apricot Lane. This ensures clear communication and documentation of agreements between both parties. Franchisees also agree to waive trial by jury in any action, proceeding, or counterclaim brought by either party, and they waive the right to participate in class action lawsuits against Apricot Lane. This indicates that any disputes will be handled on an individual basis, potentially increasing the franchisee's legal costs if a dispute arises.
Additionally, franchisees must commence mediation or judicial proceedings within 18 months of discovering facts giving rise to a claim, except for claims arising from non-payment or underpayment of amounts owed to Apricot Lane. This clause sets a time limit for franchisees to bring any claims against the franchisor, which could be a disadvantage if issues take longer to surface. Franchisees are also responsible for maintaining required insurance policies in connection with the E-Commerce Platform and must indemnify Apricot Lane for any liabilities, obligations, and expenses incurred by Apricot Lane related to the E-Commerce Platform, including those arising under Provider Contracts. This places a significant financial responsibility on the franchisee to cover potential liabilities associated with the online platform.
Furthermore, franchisees are restricted from engaging in competitive business activities during the term of the Franchise Agreement and for a period of two years after termination or expiration. This includes not having a direct or indirect controlling interest in a Competitive Business, performing services for a Competitive Business, or diverting business or employees from the Franchised Business. These non-compete clauses are fairly standard in franchising to protect the brand and business model. Apricot Lane also reserves the right to vary standards for any franchisee or particular circumstance without being required to disclose or grant a similar variation to other franchisees. This allows Apricot Lane flexibility in managing the franchise system but could lead to perceived unfairness among franchisees if standards are not applied consistently.
In summary, prospective Apricot Lane franchisees should carefully review these provisions with legal and financial advisors to fully understand their obligations, limitations, and potential liabilities under the Franchise Agreement. Paying particular attention to dispute resolution, time limits for claims, e-commerce responsibilities, and non-compete restrictions is crucial for making an informed decision.