What is the relationship between the Franchise Deposit Receipt Agreement and a Franchise Agreement with Big O Tires?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
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- This Franchise Deposit Receipt Agreement is not a Franchise Agreement and does not grant Applicant any rights to use Big O's licensed trademarks or licensed methods or systems.
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- Applicant understands and acknowledges that Applicant grants no contractual rights or duties hereunder.
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- Applicant acknowledges that Big O has provided Applicant with a Franchise Disclosure Document not later than the earliest of fourteen (14) days before any payment of any consideration or the execution of any agreement related to the acquisition of a Franchise or such earlier date as provided in the receipt to the Franchise Disclosure Document or as requested by Applicant. Applicant acknowledges that he has read the Franchise Disclosure Document and understands its contents and Applicant shall return the Acknowledgment of Receipt by Prospective Franchisee accompanying the Franchise Disclosure Document concurrently with this Franchise Deposit Receipt Agreement.
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- Nothing in this Franchise Deposit Receipt Agreement is intended by the parties hereto to create a fiduciary relationship between them, nor constitute Applicant as a franchisee, agent, legal representative, subsidiary, joint venturer, partner or employee of Big O for any purpose whatsoever. It is understood and agreed that Applicant is an independent contractor and is in no way authorized to make any contract, warranty or representation or to create any obligation on behalf of Big O.
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- Nothing herein shall be construed as a promise, guarantee or agreement, express or implied, that Big O shall grant Applicant a Franchise, nor be bound as a franchisor, or otherwise, unless and until a Franchise Agreement is signed in writing by both parties.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to the 2025 Big O Tires Franchise Disclosure Document, the Franchise Deposit Receipt Agreement is not a Franchise Agreement. The Franchise Deposit Receipt Agreement does not grant the applicant any rights to use Big O Tires' licensed trademarks, methods, or systems. The applicant also understands that the Franchise Deposit Receipt Agreement grants no contractual rights or duties.
Big O Tires will grant an applicant a franchise based on the terms of the most recent Franchise Agreement provided to the applicant if Big O Tires approves the franchise application in writing. The applicant must pay $10,000 of the initial franchise fee when submitting the application, with the remainder due upon signing the Franchise Agreement. If the initial franchise fee is waived or reduced below $10,000 due to an incentive program, Big O Tires will credit the excess amount towards the applicant's accounts receivable for products purchased from Big O Tires.
Once Big O Tires approves the franchise application, the entire Franchise Deposit is earned by Big O Tires as consideration for the investigation and approval of the application. The $10,000 paid by the applicant is refundable only if Big O Tires does not approve the franchise application. The Franchise Deposit Receipt Agreement does not create a fiduciary relationship between the parties, nor does it constitute the applicant as a franchisee, agent, legal representative, subsidiary, joint venturer, partner, or employee of Big O Tires.