Under what circumstances is the Developer required to obtain and furnish executed covenants to Ben Jerrys from specific individuals?
Ben_Jerrys Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.7 At the request of BEN & JERRY'S, DEVELOPER shall obtain and furnish to BEN & JERRY'S executed covenants similar in substance to those set forth in of this Section 8 (including covenants applicable upon the termination of a person's relationship with DEVELOPER) from any or all of the following persons: (a) all officers, directors, and holders of a beneficial interest of one percent (1%) or more of the securities of DEVELOPER, and of any corporation directly or indirectly controlling, controlled by, or under common control with, DEVELOPER, if DEVELOPER is a corporation; and (b) the general partners and any limited partners (including any corporation, and the officers, directors, and holders of a beneficial interest of one percent (1%) or more of the securities of any corporation which controls, directly or indirectly, any general or limited partner), if DEVELOPER is a partnership.
Every covenant required by of this Section 8.7 shall be in a form approved by BEN & JERRY'S, including specific identification of BEN & JERRY'S as a third-party beneficiary of such covenants with the independent right to enforce them.
Source: Item 23 — RECEIPTS (FDD pages 134–358)
What This Means (2025 FDD)
According to Ben Jerrys's 2025 Franchise Disclosure Document, the Developer is required to obtain and furnish executed covenants to Ben & Jerry's from specific individuals under certain circumstances. Specifically, at Ben & Jerry's request, the Developer must obtain covenants from individuals similar in substance to those outlined in Section 8 of the agreement, including covenants applicable upon the termination of a person's relationship with the Developer.
These individuals include all officers, directors, and holders of a beneficial interest of one percent (1%) or more of the securities of the Developer, if the Developer is a corporation. This also applies to any corporation directly or indirectly controlling, controlled by, or under common control with the Developer. If the Developer is a partnership, the requirement extends to the general partners and any limited partners, including any corporation, and the officers, directors, and holders of a beneficial interest of one percent (1%) or more of the securities of any corporation which controls, directly or indirectly, any general or limited partner.
Every covenant required must be in a form approved by Ben & Jerry's, explicitly identifying Ben & Jerry's as a third-party beneficiary with the independent right to enforce these covenants. This ensures that Ben & Jerry's has the legal means to protect its interests and enforce the terms of the agreement, even if the direct relationship between the Developer and the individual in question changes or terminates.