What is the definition of 'Restricted Territory' for a Bang Cookies franchise?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
"Restricted Territory" refers to and means the geographic area: (a) comprising Franchisee's
Designated Territory; (b) comprising a 25 mile radius surrounding Franchisee's Designated Territory or, if Franchisee is not granted or designated a designated territory, then a 25 mile radius surrounding Franchisee's Shop Location; (c) comprising a 10 mile radius surrounding the Shop Locations for all other Bang Cookies Shops operating and/or under development as of the Effective Date of this Agreement; and (d) comprising a 10 mile radius surrounding the Shop Locations for all other Bang Cookies Shops that are in operation or under development during all or any part of the Post-Term Restricted Period; provided, however, that if a court of competent jurisdiction determines that the foregoing Restricted Territory is too broad to be enforceable, then the "Restricted Territory" means the geographic area comprising Franchisee's Designated Territory plus a 25 mile radius surrounding Franchisee's Designated Territory or, if Franchisee is not granted or designated a designated territory, then a 25 mile radius surrounding Franchisee's Shop Location.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the 'Restricted Territory' is defined as a specific geographic area that limits where a franchisee can operate a business. The standard restricted territory includes the franchisee's Designated Territory, or if no Designated Territory exists, a 25-mile radius around the franchisee's shop location. Additionally, it encompasses a 10-mile radius around all other Bang Cookies shops operating or under development as of the agreement's effective date. It also includes a 10-mile radius around any Bang Cookies shops that are in operation or under development during any part of the post-term restricted period.
However, the document provides a contingency: if a court deems the standard Restricted Territory too broad to be enforceable, the definition changes. In such cases, the Restricted Territory will consist of the franchisee's Designated Territory plus a 25-mile radius around it. If the franchisee does not have a Designated Territory, the Restricted Territory becomes a 25-mile radius around the franchisee's shop location.
This definition of 'Restricted Territory' is important for prospective Bang Cookies franchisees because it outlines the area where they will have some protection from competition from other Bang Cookies locations. However, it's important to note the exceptions and conditions, such as the possibility of a court altering the territory's size and the existence of other franchisees who may market into the Designated Territory. Franchisees should carefully consider these factors and discuss them with Bang Cookies before signing the franchise agreement.