If a Baya Bar franchisee develops any Improvements, what is the franchisee required to promptly notify the franchisor about?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 19.4 New Concepts. If Franchisee or any Principal develops any new concept, process, product, recipe, or improvement in the operation or promotion of the Franchised Business ("Improvements"), Franchisee is required to promptly notify Franchisor and provide Franchisor with all related information, processes, products, design or other improvements, and sign any and all forms, documents and/or papers necessary for Franchisor to obtain full proprietary rights to such Improvements, without compensation and without any claim of ownership or proprietary rights to such Improvements. Franchisee and any Principal acknowledge that any such Improvements will become the property of Franchisor, and Franchisor may use or disclose such information to other franchisees as it determines to be appropriate.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, if a franchisee or any principal develops any new concept, process, product, recipe, or improvement in the operation or promotion of the franchised business, which are referred to as "Improvements", the franchisee is required to promptly notify Baya Bar.
In addition to notifying Baya Bar, the franchisee must provide Baya Bar with all related information, processes, products, design, or other improvements. The franchisee must also sign any and all forms, documents, and/or papers necessary for Baya Bar to obtain full proprietary rights to such Improvements.
It is important to note that the franchisee will not receive any compensation for these Improvements, and they cannot claim any ownership or proprietary rights to them. The FDD states that any such Improvements will become the property of Baya Bar, and Baya Bar may use or disclose such information to other franchisees as it determines to be appropriate. This means that while a franchisee might innovate and improve the Baya Bar system, they will not be able to monetize or protect those innovations for their exclusive use.