Must Belocal franchisees use the form contracts provided by the franchisor or its affiliate?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
In promoting the Publication, Franchisee, its Principal(s), operations manager, and other representatives, must:
(1) Solicit contracts for print advertising in the Publication from advertisers and digital advertising services ("Advertising Contracts"), quoting prices and terms set by Franchisor or its affiliate (or otherwise approved by Franchisor in writing), and using the form contracts provided by Franchisor or its affiliate. To the fullest extent permitted by applicable law, Franchisor and/or its affiliate reserve the right to establish maximum, minimum, or other pricing requirements with respect to Advertising Contracts. Moreover, Franchisor or its affiliate shall have ultimate discretion regarding whether to enter into any Advertising Contract. All Advertising Contracts, or other contracts related to the Publication, must be between Franchisor or its affiliate and the applicable Community, Industry Group, or advertiser, and Franchisee shall not be a party to, or a third-party beneficiary of, any such Advertising Contract or any
other contract relating to the Publication. Additionally, all fees and amounts payable under the Advertising Contracts must be paid directly to Franchisor or its affiliate or their designee, as applicable, in accordance with the terms thereof, and Franchisee must not accept any payments from any Community, Industry Group, or advertiser, nor shall Franchisee make payments on behalf of any Community, Industry Group, or advertiser for any reason. Franchisor may terminate this Agreement for Franchisee's failure to comply with the requirements set forth in this Section 5.E.(1). Franchisee shall not enter into Advertising Contracts or any other contract related to the Publication on Franchisor or its affiliate's behalf, and Franchisor and its affiliates are party to any Advertising Contract or any other contract related to the Publication, not Franchisee or its Principals.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, franchisees are required to use the form contracts provided by Belocal or its affiliate when soliciting contracts for print advertising in the Publication and digital advertising services. These contracts are for advertising in the Publication and must adhere to the prices and terms set or approved by Belocal.
Belocal retains ultimate discretion over whether to enter into any Advertising Contract. All Advertising Contracts must be between Belocal or its affiliate and the advertiser, and the franchisee cannot be a party to or beneficiary of these contracts. Franchisees are also prohibited from accepting payments from advertisers; all fees must be paid directly to Belocal or its designee.
Failure to comply with these requirements regarding the use of specified contract forms and payment handling can result in the termination of the Franchise Agreement. This ensures that Belocal maintains control over advertising contracts and revenue streams, while the franchisee's role is limited to soliciting contracts under the franchisor's terms.