Under what conditions does the Batteries Plus Bulbs franchise agreement become effective?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
The term of this Agreement will be for ten (10) years commencing on the Effective Date. Subject to the provisions contained in this Agreement, Franchisor grants Franchisee a franchise (the "Franchise") to own and operate a Batteries Plus® Store at a site approved by Franchisor and to use the Licensed Marks in operating the Store. Subject to the provisions of Sections 3 and 4 of this Agreement, Franchisor agrees to grant franchises to Multiple Unit Franchisee to operate Stores located in the Designated Area under the following conditions:
- A.
Site Report.
Multiple Unit Franchisee delivers to Franchisor a complete site report (containing demographic, commercial, and other information and photographs as Franchisor reasonably requires) for each site at which Multiple Unit Franchisee proposes to establish and operate a Store and which Multiple Unit Franchisee reasonably believes to comply with site selection criteria established by Franchisor.
The proposed site is subject to Franchisor's prior written acceptance, which will not be unreasonably withheld.
In accepting or rejecting any proposed site, Franchisor will consider demographic characteristics of the proposed site, traffic patterns, parking, the predominant character of the neighborhood, competition from auto parts and auto service stores, the proximity to other businesses (including other Batteries Plus stores), the nature of other businesses in proximity to the site, and other commercial characteristics and the size of premises, appearance, and other physical characteristics.
Franchisor's acceptance of a proposed Store site does not represent a warranty or representation of any kind as to the suitability of the proposed location for a Batteries Plus® store.
- B.
Financial Capability Criteria.
Multiple Unit Franchisee meets the standard financial capability criteria developed by Franchisor.
To this end, Multiple Unit Franchisee must furnish to Franchisor financial statements and other information regarding Multiple Unit Franchisee and the development and operation of the proposed Store (including pro forma statements and investment and financing plans for the proposed Store) as Franchisor reasonably requires.
- C.
Store Site Acceptance.
Franchisor will accept or reject Store sites proposed by Multiple Unit Franchisee by delivering written notice to Multiple Unit Franchisee.
Source: Item 22 — Contracts (FDD page 80)
What This Means (2025 FDD)
According to the 2025 Batteries Plus Bulbs FDD, the franchise agreement's term is for ten years, commencing on the Effective Date. The FDD does not explicitly define the conditions that must be met for the franchise agreement to become effective. However, it does state that Batteries Plus Bulbs grants a franchise to own and operate a Batteries Plus Bulbs store at a site approved by them.
For a multiple-unit franchisee, the agreement is subject to specific conditions. The franchisee must deliver a complete site report for each proposed store location that meets Batteries Plus Bulbs' site selection criteria. Batteries Plus Bulbs must provide prior written acceptance of the proposed site, considering factors such as demographics, traffic patterns, parking, neighborhood character, competition, proximity to other businesses, and the site's physical characteristics. Batteries Plus Bulbs' acceptance of a site does not guarantee its suitability for a Batteries Plus Bulbs store.
Additionally, the multiple-unit franchisee must meet Batteries Plus Bulbs' standard financial capability criteria and provide financial statements and other information regarding the franchisee and the proposed store's development and operation. Batteries Plus Bulbs will then accept or reject store sites proposed by the multiple-unit franchisee by delivering written notice. A prospective franchisee should clarify with Batteries Plus Bulbs the specific conditions required for the franchise agreement to become effective, as this information is not fully detailed in the provided excerpts.