What representation does a Belocal franchisee make regarding its due organization and valid existence?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
- J.
Organization.
If Franchisee is a corporation, partnership, limited liability company, or other legal entity, Franchisee represents and warrants the following:
(1) Franchisee is duly organized and validly existing under the laws of the state of its formation;
(2) Franchisee is duly qualified and is authorized to do business in each jurisdiction in which its business activities or the nature of the properties owned by it require such qualification;
(3) Franchisee's corporate charter or written partnership or limited liability company agreement shall at all times provide that the activities of Franchisee are confined exclusively to the operation of the Franchised Business;
(4) The execution of this Agreement and the performance of the transactions contemplated hereby are within Franchisee's corporate power, if Franchisee is a corporation, or if Franchisee is a partnership or a limited liability company, are permitted under Franchisee's written partnership or limited liability company agreement and have been duly authorized by Franchisee; and
(5) Franchisee has provided to Franchisor prior to the execution of this Agreement, and from time to time during the Term of this Agreement shall provide to Franchisor at Franchisor's request, copies of Franchisee's articles of incorporation and bylaws or, as applicable, Franchisee's written partnership or limited liability company agreement, other governing documents, any amendments to such documents, resolutions authorizing Franchisee's entry into and performance of this Agreement, and any
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, if a franchisee is a corporation, partnership, limited liability company, or other legal entity, they must represent and warrant that they are duly organized and validly existing under the laws of the state where they were formed. This means the franchisee's business structure must be legally recognized and in good standing according to the regulations of its state of formation.
Belocal also requires the franchisee to warrant that they are duly qualified and authorized to conduct business in any jurisdiction where their business activities or owned properties necessitate such qualification. This ensures that the franchisee complies with all applicable state and local business registration and licensing requirements. The franchisee must also ensure that their corporate charter, partnership agreement, or LLC agreement stipulates that their activities are exclusively limited to operating the Belocal franchised business.
Furthermore, the franchisee must confirm that executing the Franchise Agreement and completing the transactions it outlines are within their corporate power (if a corporation) or permitted by their partnership or LLC agreement. This confirms that the franchisee has the legal authority to enter into the agreement. Belocal also requires the franchisee to provide copies of their organizational documents, including articles of incorporation, bylaws, partnership agreements, or LLC agreements, along with any amendments, resolutions authorizing the agreement, and documents restricting the sale or transfer of ownership interests. These documents must be provided before the agreement is signed and updated as requested by Belocal during the term of the agreement.