Does the Baya Bar franchise agreement inure to the benefit of the administrators of the franchisee?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
or franchisees, Franchisor reserves the right to use the Brand Fund for public relations, to explain the franchise system, and/or to include a notation in any advertisement indicating "Franchises Available."
- 13.3.5 The Brand Fund will be operated solely as a conduit for collecting and expending the advertising contributions for the System. The Brand Fund will not be used to defray any of Franchisor's general operating expenses, except for reasonable administrative costs and overhead that Franchisor may incur in activities related to the administration and direction of the Brand Fund and such costs and expenses pursuant Section 13.3.4. The Brand Fund and its earnings shall not otherwise inure to Franchisor's benefit.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the Brand Fund, which is used for advertising and marketing, will not be used to defray any of the franchisor's general operating expenses, except for reasonable administrative costs. The FDD states that the Brand Fund and its earnings shall not otherwise inure to Baya Bar's benefit.
Additionally, the Baya Bar franchise agreement specifies that all of the franchisee's obligations are binding on the franchisee's successors, assigns, and affiliated persons or entities as if they had duly executed the agreement.
Therefore, while the Brand Fund is not intended to directly benefit Baya Bar, the franchisee's obligations under the agreement do extend to successors, assigns, and affiliated entities.