Under the Beard Papas Franchise Agreement, where is the Designated Territory defined?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
Once you secure a Shop Location that we approve, we will define the Designated Territory for your Shop and include the geographic boundaries and/or a description of your Designated Territory within Schedule 1 of the Franchise Agreement. (Franchise Agreement, Article 2 and Schedule 1);
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- Multi-Unit Development Agreement Development Area If you have entered into a Multi-Unit Development Agreement, we will designate your Development Area. The Shops to be developed by you must be located within the Development Area. Once you select a Shop Location that we approve within the Development Area, within the Franchise Agreement for each respective Shop we will define the Designated Territory and include the geographic boundaries and/or a description of your Designated Territory for each respective Shop. (Multi-Unit Development Agreement, Section 2). Our approval or disapproval of future Shop locations that may be developed under a Multi-Unit Development Agreement will be based on our then current site selection criteria;
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 31–38)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, the Designated Territory for a franchise shop is defined within Schedule 1 of the Franchise Agreement. Specifically, once a franchisee secures a shop location that Beard Papas approves, the geographic boundaries and/or a description of the Designated Territory will be included in Schedule 1 of the Franchise Agreement. This definition is established under Article 2 of the Franchise Agreement. For franchisees entering into a Multi-Unit Development Agreement, the process is similar. After the franchisee selects a shop location within the Development Area that Beard Papas approves, the Designated Territory for each respective shop will be defined within the Franchise Agreement for that shop. This definition will also include the geographic boundaries and/or a description of the Designated Territory and is governed by Section 2 of the Multi-Unit Development Agreement.
This means that a prospective Beard Papas franchisee will not have a concrete definition of their territory until a location is approved by the franchisor and the Franchise Agreement is finalized. The Designated Territory is a crucial aspect of the franchise agreement as it outlines the area where the franchisee will have certain rights and protections. It is important for potential franchisees to understand how the territory is defined and what exclusivity rights, if any, are granted within that territory.
Beard Papas retains the right to approve or disapprove future shop locations developed under a Multi-Unit Development Agreement based on their current site selection criteria. This ensures that all locations meet the franchisor's standards and strategic objectives. The FDD also mentions that the franchisee's rights in their shop location must be subordinate to Beard Papas's rights as set forth in the Lease Agreement Rider and the Collateral Assignment of Lease, further emphasizing the franchisor's control over site selection and lease terms.