Can Azal Coffee or its affiliates operate businesses under the Franchise Marks within a franchisee's protected area?

According to Azal Coffee's 2024 Franchise Disclosure Document, Azal Coffee and its affiliates retain the right to operate businesses under the Franchise Marks and Franchise Systems within a franchisee's protected area under specific circumstances. These locations include food trucks, ghost kitchens, corporate cafeterias, institutional accounts (such as grocery stores and warehouse clubs), offsite events (like art fairs and fundraisers), stadiums, and locations with relatively fixed populations, such as airports, military bases, college campuses, hospitals, indoor regional malls, and large office buildings where many inhabitants do not leave for lunch. Additionally, mobile locations like food trucks are included.

This reservation of rights means that while an Azal Coffee franchisee is granted a protected area, this protection is not absolute. Azal Coffee can still establish alternative points of distribution within that area through various channels. This could potentially impact a franchisee's revenue if these alternative locations draw customers away from the traditional Azal Coffee store.

Prospective franchisees should be aware of these exceptions and consider how these alternative locations might affect their business. It is important to assess the potential impact of these other distribution channels on the profitability of the franchise and to understand the extent to which Azal Coffee might utilize these rights in the future. Franchisees should inquire about Azal Coffee's plans for these alternative locations within their protected area during their due diligence.