What are the franchisee's obligations to Bang Cookies upon termination or non-renewal of the Franchise Agreement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
| q. Non-competition covenants during the term of the franchise | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Shop developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. | |
|---|---|---|---|
| r. Non-competition covenants after the franchise is terminated or expires | Not applicable | Not applicable as to Multi-Unit Development Agreement. However, each Shop developed pursuant to Multi-Unit Development Agreement will be subject to non-competition covenants set forth in each respective Franchise Agreement. | |
| s. Modification of the agreement | 5.3, 7.11 | Only by written agreement between you and us or if governing law requires a modification. We can change the form of the Franchise Agreement for future Shops which will not alter your obligations under the Multi-Unit Development Agreement. | |
| t. Integration/merger clauses | 7.12 | The Multi-Unit Development Agreement is the entire agreement between you and us relating to the development of the Exclusive Territory. Notwithstanding the foregoing, nothing in any agreement is intended to disclaim the express representations made in the Franchise Disclosure Document, its exhibits and amendments. | |
| u. Dispute resolution by arbitration or mediation | 7.5, 7.6 | Except for certain claims for injunctive relief, all disputes must first be submitted to non-binding mediation in Bergen County, New Jersey and, if mediation is unsuccessful, then to binding arbitration in Bergen County, New Jersey. This provision is subject to applicable state law. | |
| v. Choice of forum | 7.5, 7.6 | All mediation, arbitration and, if applicable, litigation proceedings must be conducted in, or closest to, State court of general jurisdiction that is within or closest to Bergen County, New Jersey. This provision is subject to applicable state law. | |
| w. Choice of law | 7.5, 7.6 | New Jersey law will govern. However, this provision is subject to state law and as otherwise disclosed in Exhibit I to this Disclosure Document. |
| i. | Franchisee's obligations on termination/non-renewal | 6, 17 | You must: pay all sums that you owe to us under the Franchise Agreement and all other agreements with us; cease owning and operating the Franchised Business; cease representing yourself as a franchisee of ours; permanently cease using and/or accessing the System, the Licensed Marks, our confidential information, the operations manual, the Business Management System, the Business Management System Data, and the System Supplies; return the operations manual and all confidential information to us in the original form provided to you and document the destruction of all electronic files related to same; completely de-identify the location and/or facility associated with the Franchised Business; as requested by us, transfer to us all data, telephone listings, digital media, accounts, web listings and websites associated with the Franchised Business; and abide by the post-termination non-competition covenants and restrictions. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–49)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, upon termination or non-renewal of the Franchise Agreement, a franchisee has several obligations to Bang Cookies. These obligations ensure the franchisee ceases all operations related to the Bang Cookies brand and protects the brand's confidential information and competitive interests.
Specifically, the franchisee must pay all outstanding sums owed to Bang Cookies under the Franchise Agreement and any other agreements. They must cease operating the Franchised Business and stop representing themselves as a Bang Cookies franchisee. The franchisee is also required to permanently discontinue using or accessing the Bang Cookies system, licensed marks, confidential information, operations manual, Business Management System, Business Management System Data, and System Supplies.
Furthermore, the franchisee must return the operations manual and all confidential information in their original form, documenting the destruction of all related electronic files. The location associated with the Franchised Business must be completely de-identified. Bang Cookies may also request the transfer of all data, telephone listings, digital media, accounts, web listings, and websites associated with the Franchised Business. Finally, the franchisee must adhere to post-termination non-competition covenants and restrictions, which typically restrict involvement in similar businesses within a specified area for a certain period.