What is the geographic scope of the protected territory granted to a Better Blend franchisee?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
ssets of the Business, (ii) this Agreement, (iii) any direct or indirect ownership interest in the Business, or (iv) control of the Business.
ARTICLE 2. GRANT OF LICENSE
- 2.1 Grant. BBF grants to Franchisee the right to operate a Better Blend business solely at the Location. If no Location is stated on the Summary Page when this Agreement is signed, then the parties will determine the Location in accordance with Section 6.1. Franchisee shall develop, open and operate a Better Blend business at the Location for the entire term of this Agreement. Franchisee shall exert its best efforts to promote and enhance the Business.
- 2.2 Protected Territory. BBF shall not establish, nor license the establishment of, another business within the Territory (other than a Limited Access Venue) selling the same or similar goods or services under the same or similar trademarks or service marks as a Better Blend business. This prohibition does not apply to any Better Blend business operating or under construction when the Territory is determined. BBF and its affiliates retain the right to do any of the following (all without any compensation to Franchisee):
- (i) establish and license others to establish and operate Better Blend businesses outside the Territory, notwithstanding their proximity to the Territory or their potential impact on the Business;
- (ii) establish and license others to establish and operate Better Blend businesses in Limited Access Venues inside the Territory;
- (iii) operate and license others to operate businesses anywhere, including within the Territory, that sell the same or similar goods or services as a Better Blend business under trademarks or service marks that are not the same as or similar to the Marks;
- (iv) sell and license others to sell any products and services in the Territory under any trademarks or service marks (including the Marks) through channels of distribution (including the internet) other than Better Blend;
- (iv) acquire or be acquired by (under any form of business transaction) a Competitor that has (or may in the future have) outlets in the Territory which compete with the Business under trademarks or service marks other than the Marks; and
- (v) engage in any action not specifically precluded by the express terms of this Agreement.
- 2.3 Franchisee Control. Franchisee represents that Attachment 1 (i) identifies each owner, officer and director of Franchisee, and (ii) describes the nature and extent of each owner's interest in Franchisee. If any information on Attachment 1 changes (which is not a Transfer), Franchisee shall notify BBF within 10 days.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, a franchisee is granted a protected territory where Better Blend will not establish or license another business selling similar goods or services under the same trademarks. This protection does not extend to 'Limited Access Venues' within the territory or to businesses operating or under construction when the territory is defined.
Better Blend retains the right to establish or license businesses outside the franchisee's territory, regardless of proximity or impact. They can also operate or license businesses anywhere, including within the franchisee's territory, that sell similar goods or services under different trademarks. Additionally, Better Blend can sell and license others to sell products and services through other distribution channels, including the internet, even using the same trademarks.
If the Franchise Agreement is terminated before the territory is determined, the non-competition area will be the Site Selection Area and within five miles of any other Better Blend business operating on the termination date. If a Better Blend business does not have a defined territory, its territory is considered a 3-mile radius for non-competition purposes.
This means that while Better Blend offers a protected territory, there are several exceptions that could allow competition within or near the franchisee's area. A prospective franchisee should carefully consider these exceptions and how they might affect their business. It would be prudent to discuss the specifics of territory determination and potential competitive scenarios with Better Blend before signing the Franchise Agreement.