What is the 'Mandatory Development Schedule' for Baya Bar franchisees described in?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
ther developed by Franchisor from time to time (each a "Franchise Agreement").
Developer understands and acknowledges the importance of Franchisor's high and uniform standards of quality, service, and appearance, and the necessity of operating franchised businesses of the System in conformity with Franchisor's standards and specifications.
Developer desires to obtain the right to further develop and expand the System in accordance with the development schedule described in Section 5.2 hereof (the "Mandatory Development Schedule") within the development area described in Attachment 2 (the "Development Area"), under the System and Marks, on the terms and conditions set forth in this Agreement;
NOW, THEREFORE, the parties, in consideration of the promises, undertakings and commitments of each party to the other set forth herein, and intending to be legally bound hereby, mutually agree as follows:
1. RECITATIONS. The Recitations set out above form part of this Agreement.
2. GRANT OF DEVELOPMENT RIGHTS.
- 2.1 Grant. Franchisor hereby grants to Developer, and the Developer hereby accepts from the Franchisor, on the terms and conditions set forth in this Agreement, which includes, but is not limited to, the execution of a Franchise Agreement pursuant to Section 4.1 hereof, the right to develop, construct, open and operate one (1) Baya Bar outlet within the Development Area set forth in Attachment 2. Developer shall be granted rights to establish additional Baya Bar café outlets in the Development Area, up to the total number of outlets set forth in the Mandatory Development Schedule set forth in Section 5.2 hereof, subject to Developer's full compliance with all conditions precedent to the grant of such rights outlined below, which rights shall be exercised in accordance with Section 4.1 hereof.
- 2.2 Reservation of Rights. Notwithstanding the provisions of Section 2.1 above, Developer understands and agrees Franchisor fully reserves all other rights, other than as specified in this Agreement, for sales, solicitation and distribution of Baya Bar products and services within or outside of the Development Area. This reservation of Franchisor's rights includes, but is not limited to, Franchisor's right to the rights to offer (i) other products or services not offered under the Marks, (ii) other food or beverage concepts under the Marks or other trademarks, and (iii) products or services through any channel in the Development Area other than a dedicated Baya Bar café such as distribution through retail outlets, including but not limited to, grocery stores; in captive market locations, such as airports and malls; and the Internet.
- 2.3 No License to System and Marks. Developer expressly acknowledges that this Agreement is not a Franchise Agreement and does not grant to Developer any right or license to operate a Baya Bar outlet, distribute any product or service, or use the Marks. This Agreement sets forth conditions which, if fully satisfied, confer upon Developer the rights to enter a Franchise Agreement with Franchisor to establish one or more Baya Bar outlets in the Development Area only. Developer's rights to open and operate a Baya Bar outlet and use the System and Marks shall be derived only through the execution of a Franchise Agreement for each Baya Bar outlet to be established in the Development Area.
- **3.
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the Mandatory Development Schedule is referenced in Section 5.2. This schedule requires the developer to open Baya Bar outlets according to a specific timeline. After signing the Multi-Unit Development Agreement and the initial Franchise Agreement, the developer must execute an additional Franchise Agreement for the second Baya Bar outlet upon executing a lease for the first outlet, provided all conditions in Section 5.4 are met or waived. Similarly, for each subsequent Baya Bar outlet, another Franchise Agreement must be executed upon the lease execution, adhering to the Mandatory Development Schedule, again subject to the conditions in Section 5.4 being satisfied or waived.
The developer acknowledges that the terms of the Mandatory Development Schedule are reasonable and viable based on their independent investigation. Failure to adhere to this schedule constitutes a material default under the agreement. However, the developer can seek a reasonable extension from Baya Bar if they are unable to meet the schedule for any outlet. This request must be submitted in writing at least sixty days prior to the Mandatory Open Date for the outlet.
Baya Bar will not unreasonably withhold consent for an extension if the developer has submitted the request on time, demonstrated diligent efforts to meet the original open date, acted in good faith, and is fulfilling their other obligations under the agreement. Before Baya Bar grants the developer the right to develop an additional Baya Bar outlet, the developer must request Baya Bar's current Franchise Disclosure Document, submit all required information and documents, provide requested financial statements, and satisfy Baya Bar's current financial criteria for multi-unit franchisees, as detailed in Section 5.4.