What clause must be included in each customer agreement for a Benjamin Franklin Plumbing franchise?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
To this end, each customer agreement must include a clause providing us the unconditional right (but not an obligation) to assume (directly or through a designee) the customer agreement upon the termination or expiration of this Agreement, including all of your rights and obligations thereunder that arise from and after such assumption.
Upon the expiration or termination of this Agreement, you agree to facilitate our conversations with customers to ensure an orderly transition of the business operations.
You agree to pay over to us (or our designee) any amounts (or a pro rata portion of any amounts) paid to you by your customers for services that you have not yet performed.
- 17.1.4 We can exercise any or all of our options under Sections 17.1.1, 17.1.2 and 17.1.3: (a) within thirty (30) days after the expiration of the Agreement Term, in the case of expiration of this Agreement; and (b) in the case of termination of this Agreement, at any time between the date of delivery of written notice of termination and thirty (30) days after the effective date of termination (or after the arbitration or court ruling upholding the termination, if termination is contested).
We may assign these options to another person or entity.
Source: Item 23 — RECEIPTS (FDD pages 88–312)
What This Means (2025 FDD)
According to the 2025 Benjamin Franklin Plumbing FDD, each customer agreement must include a clause granting Benjamin Franklin Plumbing the unconditional right, but not the obligation, to assume the customer agreement upon the termination or expiration of the franchise agreement. This assumption can be direct or through a designee, and includes all rights and obligations arising from the assumption forward.
This clause ensures that Benjamin Franklin Plumbing can maintain customer relationships and continue serving customers even if a franchise agreement ends. It allows for a seamless transition of business operations, preserving the value of the customer base built by the franchisee. The franchisee is obligated to facilitate conversations with customers to ensure this orderly transition.
Furthermore, the franchisee must remit to Benjamin Franklin Plumbing (or its designee) any amounts received from customers for services not yet performed at the time of termination or expiration. This provision protects the financial interests of Benjamin Franklin Plumbing and ensures that customers receive the services they have paid for, even if the original franchisee is no longer operating the business.
Benjamin Franklin Plumbing can exercise its option to assume customer agreements within a specific timeframe: within 30 days after the agreement's expiration, or, in the case of termination, anytime between the notice of termination and 30 days after the termination date (or after a ruling upholding the termination if it's contested). This option can be assigned to another person or entity, providing Benjamin Franklin Plumbing with flexibility in managing its customer relationships and business operations.