How does Black Bear Diner define 'Artificial Intelligence' in the context of its franchise agreement?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
"Approved Location" means the premises for the operation of the Franchised Restaurant selected by Franchisee and approved by Franchisor pursuant to Section 5 and as more particularly described in Section 2.2 hereof;
"Approved Supplier(s)" has the meaning given to such term in Section 13.3 hereof;
"Artificial Intelligence" means a field of science concerned with building computers and machines that can reason, learn, and act in such a way that would normally require human intelligence or that involves data whose scale exceeds what humans can analyze.
"Competitive Business" means any restaurant business which provides similar food products as those provided by a Black Bear Diner restaurant or whose method of operation or trade dress is similar to that employed in the System; provided, however, that the term "Competitive Business" shall not apply to: (i) any business operated by Franchisee under a Franchise Agreement with Franchisor; or (ii) the ownership for investment purposes of less than five percent (5%) of the stock of any publicly-traded corporation;
"Confidential Information" means the recipes, ingredients, trade secrets, methods of food preparation, techniques, formats, specifications, procedures, information, systems, methods of business management, sales and promotion techniques, and knowledge of and experience in operating a Black Bear Diner restaurant;
"Electronic Depository Transfer Account" means an account providing Franchisor with access to electronically withdraw any funds due Franchisor;
"Franchise" and variations thereof as used in this Agreement means the right granted to Franchisee by Franchisor to use the System and Marks in the operation of a Franchised Restaurant;
"Franchise Fee" has the meaning given to such term in Section 3.1 hereof;
"Franchisee" means the individual, corporation, limited liability company, partnership or other business entity who or which enters into this Agreement with Franchisor.
"Franchisor" means BBDI LLC;
"General Manager" means the individual who devotes his or her full-time and best efforts to the operations and is responsible for the day-to-day management of the Franchised Restaurant.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, 'Artificial Intelligence' is defined as a field of science focused on creating computers and machines capable of reasoning, learning, and acting in ways that typically require human intelligence. It also encompasses data analysis on a scale that exceeds human capabilities. This definition is important in the context of the franchise agreement as it sets the stage for how Black Bear Diner might integrate or regulate the use of AI technologies within its franchise operations.
For a prospective franchisee, this definition suggests that Black Bear Diner acknowledges the potential role of AI in its business model. It could imply that the franchisor may implement AI-driven systems for various purposes, such as data analysis, customer service, or operational efficiency. Understanding this definition helps franchisees anticipate future technological integrations and their potential impact on day-to-day operations.
However, the FDD does not elaborate on the specific applications of AI within the Black Bear Diner system or any restrictions on its use by franchisees. Therefore, potential franchisees should inquire about how AI is currently used or planned to be used by the franchisor, as well as any policies governing its implementation at the franchise level. This will help them understand the extent to which AI may influence their business and whether they need to invest in or adapt to AI-related technologies.