Does the Belocal franchise agreement allow for unilateral changes by the Franchisor, other than those explicitly permitted?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) Franchisee understands and agrees that Franchisor may operate and change the System and Franchisor's business in any manner that is not expressly and specifically prohibited by this Agreement.
Without limitation of the foregoing, Franchisee acknowledges that the products and services to be offered by Franchisee may be supplemented, improved, or otherwise modified from time to time by Franchisor.
In such circumstances, Franchisee's use of the additional or substitute proprietary marks and copyrighted materials shall be governed by the terms of this Agreement.
Franchisee shall promptly comply with each such addition, change, revision, discontinuation, or substitution and bear all expenses associated therewith.
Franchisor shall not be obligated to compensate Franchisee for any costs or expenses incurred by Franchisee in connection with any such addition, change, revision, discontinuation, or substitution.
Notwithstanding anything in this Agreement to the contrary, Franchisor has the right to restrict Franchisee from offering or selling advertisements in any form to any client or prospective client at any time.
Franchisor has the right to allow other franchisees, affiliates of Franchisor, or any other party Franchisor deems appropriate to offer and sell advertising in any forms to clients located in Franchisee's Territory, without any liability to Franchisee.
- (5) Except as permitted by and in accordance with the Franchise Brand Standards Manual, Franchisee is expressly prohibited from utilizing any form of artificial intelligence ("AI") in the operation, management, or marketing of the Franchised Business or the Publication without Franchisor's express written approval.
This prohibition includes, but is not limited to, a prohibition on using AI-driven customer service, data analysis, image generation, text generation, code generation, sound generation, and decision-making tools.
Any breach of this provision will be considered a material violation of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, Belocal retains the right to modify its business operations in ways not explicitly prohibited by the franchise agreement. Specifically, Belocal can supplement, improve, or otherwise modify the products and services offered by franchisees. This means that Belocal franchisees must be prepared for potential changes to their business model and offerings.
Belocal's right to make changes extends to the use of proprietary marks and copyrighted materials. Belocal can add, change, revise, discontinue, or substitute these materials, and the franchisee is obligated to comply with these changes at their own expense. Belocal is not required to compensate the franchisee for any costs incurred due to these changes. This could involve updating marketing materials, changing product offerings, or adopting new technologies, all at the franchisee's cost.
Furthermore, Belocal has the right to restrict franchisees from offering or selling advertisements to any client or prospective client at any time. Belocal can also allow other franchisees, affiliates, or any other party it deems appropriate to offer and sell advertising in any form to clients located within a franchisee's territory, without any liability to the franchisee. This could impact a franchisee's revenue potential and competitive landscape within their designated area.
Franchisees are also expressly prohibited from utilizing any form of artificial intelligence ("AI") in the operation, management, or marketing of the Franchised Business or the Publication without Belocal's express written approval. This prohibition includes, but is not limited to, a prohibition on using AI-driven customer service, data analysis, image generation, text generation, code generation, sound generation, and decision-making tools. Any breach of this provision will be considered a material violation of this Agreement.