factual

Does the Bang Cookies franchise agreement allow for sublicensing of Improvements developed by the franchisee?

Bang_Cookies Franchise · 2024 FDD

Answer from 2024 FDD Document

Franchisee agrees that with regard to the Franchised Business all customer lists and their contents and information represent Confidential Information and constitute an asset of Franchisor whether or not such information was supplied by Franchisor. During the Term of this Agreement and in connection with the development, establishment, marketing, promotion and operation of the Franchised Business, Franchisee shall disclose to Franchisor all of Franchisee's ideas, concepts, methods and products conceived or developed by Franchisee and Franchisee's affiliates, Owners, agents, and employees relating to the development and operation of Bang Cookies Shops. Franchisee hereby assigns to Franchisor and Franchisee agrees to procure from Franchisee's Owners, affiliates and employees assignment of any such ideas, concepts, methods, and products that Franchisee is required to disclose to Franchisor under this Article 6.I. Franchisor shall have no obligation to make any lump sum or on-going payments to Franchisee or Franchisee's Owners, affiliates or employees with respect to any such idea, concept, method, technique or product. Franchisee agrees that Franchisee will not use nor will Franchisee allow any other person or entity to use any such concept, method or product without obtaining Franchisor's prior written approval.

Source: Item 23 — RECEIPTS (FDD pages 56–245)

What This Means (2024 FDD)

According to Bang Cookies's 2024 Franchise Disclosure Document, the franchise agreement does not allow franchisees to sublicense improvements they develop. The agreement stipulates that any ideas, concepts, methods, or products conceived or developed by the franchisee related to the Bang Cookies shop's development and operation must be disclosed to Bang Cookies.

Furthermore, the franchisee is required to assign all rights to these innovations to Bang Cookies, and Bang Cookies is not obligated to provide any compensation for them. This assignment extends to ideas, concepts, methods, and products developed by the franchisee's owners, affiliates, and employees.

The franchisee is explicitly prohibited from using or allowing others to use any such concept, method, or product without obtaining prior written approval from Bang Cookies. This clause effectively prevents franchisees from sublicensing or otherwise profiting independently from improvements they develop for the Bang Cookies business, as the ownership and control of these innovations are transferred to the franchisor.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.