What happens to all Information if the Azal Coffee Franchise Agreement terminates?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
ARTICLE 16 - EFFECT OF TERMINATION OR EXPIRATION
16.1 Your Obligations on Expiration or Termination.
If this Agreement expires or terminates for any reason (including termination on a transfer), your rights to use the Intellectual Property and the Franchise Systems and all other rights associated with being an authorized Azal Coffee franchisee will cease and you must do the following:
- (a) You must immediately and permanently discontinue the use of the Intellectual Property, the Confidential Information, the Franchise Systems, and any trademarks, names, and logos confusingly similar to the Marks or Trade Dress, and any other materials that may, in any way, indicate that you are or were an Azal Coffee franchisee, or in any way associated with us.
- (b) You must immediately discontinue all advertising placed or ordered. You must remove and deliver to us all sign faces, advertising and promotional material, letterhead, forms, and any other items containing the Intellectual Property or the Confidential Information. You are responsible for the cost of sign and other identification removal and the cost of shipping signs and other materials to us. If you remain in possession of the Franchise Location, you must alter the premises to distinguish the premises from the appearance of a Store.
- (c) You must cease using the Brand Standards Manual, the Confidential Information, and all other proprietary business information provided by us and must return to us all copies of the Brand Standards Manual, the Confidential Information, and other bulletins or other materials received from us containing information about the Intellectual Property and Stores.
- (d) You must immediately and permanently cease to use all telephone and fax numbers, email addresses, website addresses, domain names and other electronic media that have been used in the Franchise Business (the "Telephone Numbers" and "Electronic Media") and if requested by us, must assign some or all of these Telephone Numbers and Electronic Media to us. You acknowledge that as between you and us, we have the sole right to all Telephone Numbers and Electronic Media used in the Franchise Business and all written and online directory listings associated with the Franchise Business. You authorize us, and appoint us and any of our officers as your attorney-in-fact, to direct the applicable service providers and all listing agencies to transfer those items to us or our agent or assignee if you fail or refuse to do so. You authorize the applicable service providers and all listing agencies to accept the direction in this Agreement as conclusive evidence of our exclusive rights in the Telephone Numbers and Electronic Media and directory listings and our authority to direct their transfer.
- (e) You must cease using any business name containing any of the Marks and must file an abandonment or discontinuance of the name with the appropriate local, county or state agency.
- (f) You must immediately pay all sums and debts owing to us and our affiliates, whether those sums and debts owing to us and our affiliates are evidenced by promissory notes, invoices, bills or other writings, and notwithstanding the fact that those sums and debts may not at that time be fully due and payable, those debts being accelerated automatically without further notice to you.
- (g) You must sell to us all or part of your inventory or products on hand as of the date of termination or expiration that are uniquely identified with us, if any, as we may request in writing within thirty (30) days after the date of termination or expiration. You agree that the sales price for those items will be the current published prices then being charged by the manufacturer or supplier to our authorized franchisees, not including any costs of storage or transportation paid by you to bring the goods initially to the Franchise Business, minus all costs incurred or to be incurred by us to restore the goods or the packaging of the goods to a saleable condition and minus a reasonable allowance for physical deterioration, obsolescence, or damage to the extent not restored.
16.2 Termination of Lease; Option to Assume Lease.
On expiration or termination of this Agreement, we may terminate any lease or sublease entered into between you and us for the Franchise Location.
We have the option to require you to assign your lease for the Franchise Location to us if: (a) you commit a default under the lease for the Franchise Location that is not cured within any applicable cure period; (b) this Agreement expires or is terminated; or (c) you abandon the Franchise Business. For this purpose, abandonment will be conclusively presumed if you fail to have the business open and fully operational for five (5) consecutive days.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, if the Franchise Agreement expires or terminates for any reason, the franchisee's rights to use Azal Coffee's Intellectual Property and Franchise Systems cease. The franchisee must immediately and permanently discontinue the use of the Intellectual Property, Confidential Information, and Franchise Systems. This includes trademarks, names, and logos that are similar to Azal Coffee's marks or trade dress, and any other materials that indicate association with Azal Coffee.
Furthermore, the franchisee must immediately discontinue all advertising and remove and deliver to Azal Coffee all sign faces, advertising, promotional material, letterhead, forms, and any other items containing Azal Coffee’s Intellectual Property or Confidential Information. The franchisee is responsible for the costs associated with removing signs and other identification, as well as the cost of shipping these materials to Azal Coffee. If the franchisee remains in possession of the franchise location, they must alter the premises to distinguish it from the appearance of an Azal Coffee store.
The franchisee must also stop using the Brand Standards Manual, Confidential Information, and all other proprietary business information provided by Azal Coffee, and return all copies of these materials. Additionally, the franchisee must cease using all telephone and fax numbers, email addresses, website addresses, domain names, and other electronic media associated with the franchise business. If requested by Azal Coffee, the franchisee must assign these Telephone Numbers and Electronic Media to them.
Moreover, for a period of three years after the termination of the Franchise Agreement, the franchisee is prohibited from engaging in any activities that could divert business or customers to a competing business. This includes soliciting customers, encouraging others to operate a competing business, or employing individuals involved in competitive activities. Violation of these provisions extends the prohibition period until three years after the franchisee ceases all violating activities.