What is the significance of the 'Development Information Sheet' attached as Schedule A to the Bang Cookies agreement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
The aggregate number of Development Shops (including the First Development Shop) (collectively, referred to as the "Total Development Shops") that are authorized by this Agreement and required for development, subject to the terms of this Agreement and each respective Franchise Agreement, is set forth and defined in the Development Information Sheet.
The Development Area is and shall constitute the geographic area set forth and identified in the Development Information Sheet.
The Development Information Sheet is attached as Schedule A to this Agreement and is incorporated into and made a part of this Agreement. To be effective the Development Information Sheet must be completed and signed by Franchisor.
Franchisee agrees that Franchisee must: (a) open and commence the operations of each new Development Shop in accordance with the Development Schedule for each respective Development Period, as set forth in this Agreement; and (b) maintain in operation the minimum cumulative number of Development Shops in accordance with the Development Schedule for each respective Development Period. Franchisee agrees that "time is of the essence" with respect to Franchisee's development obligations under this Agreement, and that Franchisee's failure to comply with the Development Schedule is grounds for immediate termination of this Agreement and, any future development rights granted under this Agreement.
During the Term of this Agreement, provided that Franchisee is in compliance with the terms and provisions of this Agreement including, but not limited to, the Development Schedule, and each respective Franchise Agreement, Franchisor will not open, operate, or license any third party the right to open or operate Bang Cookies Shops within the Development Area. Franchisee agrees that the designated territory for each Development Shop shall be determined by the Franchise Agreement for each respective Development Shops and that, in aggregate, the operating territories for Franchisee's Development Shops may be smaller than the Development Area.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the Development Information Sheet, attached as Schedule A to the Multi-Unit Development Agreement, is a crucial component that outlines the specifics of a franchisee's development obligations. This sheet is incorporated into and made a part of the agreement, and it must be completed and signed by Bang Cookies to be effective. It defines the geographic area where the franchisee is authorized to develop Bang Cookies shops, known as the Development Area, and specifies the total number of shops the franchisee is obligated to develop, open, and operate.
The Development Information Sheet also contains the Development Schedule, which sets forth the measurement periods (Development Periods) and the number of new Bang Cookies shops that must be opened within each period, as well as the minimum cumulative number of shops that must be operational by the end of each Development Period. Franchisees must adhere strictly to this schedule, as failure to comply can result in immediate termination of the agreement and loss of future development rights. However, as long as the franchisee is in compliance with the agreement, Bang Cookies will not open, operate, or license any third party to open or operate Bang Cookies shops within the Development Area.
Prospective Bang Cookies franchisees should carefully review the Development Information Sheet to fully understand their development obligations and the associated timelines. The franchisee also confirms they have independently investigated the viability of the Development Schedule and find it reasonable. The Development Information Sheet also includes the Development Area Fee, the Total Development Shops, and the Development Shop Initial Franchise Fee for the First Development Shop. Understanding these requirements is essential for assessing the feasibility and potential risks of the multi-unit development venture with Bang Cookies.