What is the dependency for Bang Cookies entering into the Franchise Agreement with the Franchisee?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
For each Bang Cookies Shop owned, developed and opened for business by the Franchisee in the Development Area, Franchisee must execute Franchisor's then current standard Franchise Agreement. A then current standard Franchise Agreement must be executed by the Franchisee for each and each Development Shop on or before the earlier of: (a) the date Franchisee (subject to Franchisor's approval of the Shop Location) executes a lease for the Shop Location for each respective Development Shop; (b) the date Franchisee (subject to Franchisor's approval of the Shop Location) enters into a purchase agreement for the real estate for the Shop Location for each respective Development Shop; or (c) six months prior to the date that each respective Development Shop must be open and in operation pursuant to the Development Schedule.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, for each Bang Cookies Shop the franchisee intends to open in the Development Area, the franchisee must execute the franchisor's current standard Franchise Agreement. This agreement must be executed on or before the earliest of three conditions.
The first condition is the date the franchisee executes a lease for the shop location, provided the franchisor approves the location. The second is the date the franchisee enters into a purchase agreement for the real estate of the shop location, again subject to the franchisor's approval. The third condition is six months prior to the date the Development Shop must be open and operating, as per the Development Schedule.
In simpler terms, Bang Cookies requires a signed franchise agreement before a location is secured through a lease or purchase, or at least six months before the shop's scheduled opening. This ensures that both parties are aligned and committed before significant steps like securing real estate are taken. This is a fairly standard practice in franchising, as it protects the franchisor's brand and system while providing the franchisee with the legal right to operate under the brand.