What is the definition of 'Restricted Territory' in the Bang Cookies franchise agreement?
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 geographic area with multiple components. It includes the franchisee's Designated Territory, if one is assigned. Additionally, it encompasses a 25-mile radius surrounding the franchisee's Designated Territory or, if no Designated Territory is assigned, a 25-mile radius around the franchisee's Shop Location.
The definition also extends to a 10-mile radius around the Shop Locations of all other Bang Cookies Shops operating or under development as of the agreement's effective date. Furthermore, it includes a 10-mile radius around the Shop Locations of all other Bang Cookies Shops that are in operation or under development during any part of the Post-Term Restricted Period.
However, the document notes a caveat: if a court deems the defined Restricted Territory too broad to be enforceable, the 'Restricted Territory' will then be limited to the franchisee's Designated Territory plus a 25-mile radius around it, or if no Designated Territory exists, a 25-mile radius around the franchisee's Shop Location. This clause appears to be a safeguard against potential legal challenges to the enforceability of the restricted territory provisions.