What is the purpose of the background section in the Auntie Annes SRU Addendum?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
| BACKGROUND: | | A. We and you entered into a franchise agreement dated (the | "Franchise Agreement"), whereby we granted and you accepted a license to operate a Auntie | Anne's® | shop No. «Store_Number» located at «location_name», «store_street_address», | «store_city», «store_state» «store_zip». | B. We and you desire to amend the Franchise Agreement on the terms outlined below to | allow you to operate a satellite retail unit (a "SRU").
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to the 2024 Auntie Annes Franchise Disclosure Document, the Satellite Retail Unit (SRU) Addendum includes a background section to provide context for the agreement. This section clarifies that the franchisee and Auntie Annes have an existing franchise agreement for an Auntie Anne's shop at a specific location. The purpose of the SRU Addendum is to amend the original Franchise Agreement, allowing the franchisee to operate a satellite retail unit.
The background section states that both parties wish to modify the original agreement to permit the operation of an SRU. This modification allows the franchisee to extend their business operations beyond the initially agreed-upon location. The SRU will operate under the terms defined in the addendum.
Specifically, the addendum modifies section 1.1 of the original franchise agreement, which concerns the grant of the franchise. The amendment allows the franchisee to operate the Franchised Business not only at the Accepted Location but also at a specified SRU Location, if approved by Auntie Annes. Furthermore, section 3.2.C. is amended to clarify that "Net Sales" includes all revenues generated from the SRU.