Is the Belocal franchisee's right to operate the franchised business exclusive or non-exclusive?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
- B.
Reserved Rights.
The rights granted to Franchisee under this Agreement are nonexclusive, and Franchisee is not granted any territorial rights or other protection.
Accordingly, Franchisor, its affiliates, and any other authorized person or entity shall, without limitation, have the right (1) to develop and establish other business systems (including systems that distribute products or services similar to those offered by the Franchised Business) using the Marks, or other names or marks, and to grant licenses to use those systems at any location without providing any rights to Franchisee; (2) to advertise and promote any N2 publications, N2 Co. businesses, and the businesses of Franchisor's franchisees, anywhere; (3) to operate, and license others to operate, any Franchised Business, N2 publication franchised businesses, or any business of any of Franchisor's affiliates, anywhere, including locations that are inside, adjacent to, or surrounded by Franchisee's Territory; and (4) to engage, directly or indirectly, at wholesale, retail, or otherwise, in the production, distribution, license, and sale of all forms (including electronic forms) of magazines, newsletters, advertising, marketing, graphic and web design, or other services and products, under the Marks, or under other names or marks, at any location, including in the Territory, through any method of distribution, including, but not limited to, mail order catalogs and the Internet, regardless of the proximity to, or the competitive impact on, the Franchised Business.
Franchisor has the sole discretion to change Franchisee's Territory, including its size, shape, boundaries, and population, upon ninety (90) days' notice to Franchisee.
- C.
Cross-publication Advertising.
Notwithstanding anything to the contrary herein, Franchisee acknowledges and agrees that other persons or entities may sell advertising for the Publication.
These other persons or entities include, without limitation, Franchisor, Franchisor's affiliates, and other franchisees.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the rights granted to a franchisee are non-exclusive. The Franchise Agreement explicitly states that Belocal does not grant any territorial rights or other protection to the franchisee. This means that Belocal retains the right to operate or license others to operate similar businesses, including those that may compete directly with the franchisee's business, even within the franchisee's designated territory.
Belocal, its affiliates, and any authorized person or entity have the right to develop other business systems using the Belocal marks, advertise N2 publications and businesses of Belocal's franchisees anywhere, and operate or license others to operate franchised businesses, including those inside, adjacent to, or surrounded by the franchisee's territory. They can also engage in the production, distribution, and sale of various forms of media and services under the Belocal marks, including within the franchisee's territory, through any method of distribution, including online platforms.
Furthermore, Belocal retains the discretion to change a franchisee's territory, including its size, shape, boundaries, and population, with ninety days' notice. Other individuals or entities, including Belocal, its affiliates, and other franchisees, may also sell advertising for the Belocal publication. This lack of exclusivity and territorial protection means that a Belocal franchisee faces the risk of direct competition from the franchisor, its affiliates, and other franchisees, which could significantly impact their business's potential revenue and market share.