Will a Black Bear Diner franchisee receive an exclusive territory?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 12: TERRITORY]
Franchise Agreement
Under the Franchise Agreement, you will be granted the right to develop and operate a Franchised Restaurant at a specific location that first must be approved by us. You may not relocate the Franchised Restaurant without our prior written consent. If, prior to the termination or expiration of the Franchise Agreement, the lease or sublease for your Black Bear Diner restaurant location expires or terminates without your fault, or if the premises are destroyed, condemned or otherwise rendered unusable, we will permit you to relocate your Black Bear Diner restaurant to a new site acceptable to us. Any relocation will be at your sole expense, including reimbursing us for all reasonable costs and expenses that we may incur in connection with evaluating, approving and/or implementing the relocation. You also must indemnify us against all loss, liability, costs and expenses that we may incur in connection with any aspect of the relocation process.
Under the terms of the Franchise Agreement, we will grant you a geographic area known as a "Protected Area". If you comply with the Franchise Agreement, we will not operate or license others to operate a Black Bear Diner restaurant from a location within the Protected Territory during the term of the Franchise Agreement. A description of the Protected Territory is included as an exhibit to the Franchise Agreement. The perimeter of the Protected Territory may be described by street boundaries, county lines, state lines, municipal boundaries or other similar boundary descriptions. For the typical Franchised Restaurant, the Protected Territory will encompass an approximate 3-mile radius around the Franchised Restaurant.
[Item 12: TERRITORY]
Except as specifically limited by the Development Agreement, we retain all rights with respect to Franchised Restaurants, the Marks, and any products and service. As part of the rights reserved by us in the Development Agreement, we may (1) establish and operate, and license others to establish and operate, Black Bear Diner restaurants at any location outside of the Development Area; (2) establish and operate, and license others to establish and operate, other businesses including similar restaurant concepts, using other trademarks, service marks and commercial symbols at any location either within and outside of the Development Area; (3) sell and distribute products authorized for use and resale at the Franchised Restaurant, including the Gift Shop Products, at wholesale and at retail through alternative channels of distribution including, but not limited to, grocery stores, convenience stores, mail order and Internet sales to customers wherever located, including customers that may be located within the Development Area; and (4) engage in any other activities not expressly forbidden by the Area Development Agreement. Under the terms of the Area Development Agreement, you have no right to operate a Black Bear Diner restaurant or to solicit or accept orders for any products or services. These and other related rights are only granted to you upon signing a Franchise Agreement. Because of the rights we reserve, you will not receive an exclusive territory under the Development Agreement. You may face competition from other franchisees, from outlets we own, or from other channels of distribution or competitive brands we control.
[Item 12: TERRITORY]
As part of the rights reserved by us in the Franchise Agreement, we may (1) establish and operate, and license others to establish and operate, Black Bear Diner restaurants at any location outside of the Protected Area; (2) establish and operate, and license others to establish and operate, other businesses including similar restaurant concepts, using other trademarks, service marks and commercial symbols at any location either within and outside of the Protected Area; (3) sell and distribute products authorized for use and resale at the Franchised Restaurant, including the Gift Shop Products, at wholesale and at retail through alternative channels of distribution including, but not limited to, grocery stores, convenience stores, mail order and Internet sales to customers wherever located, including customers that may be located within the Protected Area; and (4) engage in any other activities not expressly forbidden by the Franchise Agreement. Because of the rights we reserve, you will not receive an exclusive territory. You may face competition from other franchisees, from outlets we own, or from other channels of distribution or competitive brands we control.
[Item 12: TERRITORY]
Area Development Agreement
If you enter into an Area Development Agreement, you will receive a Development Area within which you will have the rights and obligation to develop one or more Black Bear Diner restaurants. The Development Area will vary in size, depending upon the number of Franchised Restaurants you intend to open, the population density, and the demographics in the area in which you intend to operate. Your Development Agreement will have a schedule by which each Franchised Restaurant to be developed must be approved for commencement of operations. We set the development schedule with you before you sign your Development Agreement. If you fail to meet the development schedule in your Development Agreement, your development rights and
Source: Item 12 — TERRITORY (FDD pages 35–37)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, the franchisee's territorial rights depend on whether they sign a Franchise Agreement or an Area Development Agreement.
Under the Franchise Agreement, Black Bear Diner grants a "Protected Area" to the franchisee. As long as the franchisee complies with the Franchise Agreement, Black Bear Diner will not operate or license others to operate a Black Bear Diner restaurant within the Protected Territory during the term of the Franchise Agreement. The Protected Territory's perimeter is described in an exhibit to the Franchise Agreement and may be defined by streets, county lines, or other boundaries. For a typical restaurant, the Protected Territory is an approximate 3-mile radius around the restaurant. However, the FDD also states that Black Bear Diner reserves the right to establish or license others to establish Black Bear Diner restaurants outside of the Protected Area, establish other businesses (including similar restaurant concepts) within or outside the Protected Area, and sell products through alternative channels of distribution (like grocery stores or the Internet) to customers within the Protected Area. Because of these rights that Black Bear Diner reserves, the FDD states that franchisees will not receive an exclusive territory and may face competition from other franchisees, outlets Black Bear Diner owns, or other distribution channels.
If a franchisee enters into an Area Development Agreement, they will receive a Development Area within which they have the rights and obligation to develop one or more Black Bear Diner restaurants. The size of the Development Area depends on the number of restaurants, population density, and demographics. The franchisee's Development Agreement will include a schedule for when each restaurant must be approved for commencement of operations. As long as the franchisee complies with the Area Development Agreement and related Franchise Agreements, Black Bear Diner will not establish or license others to establish a Black Bear Diner restaurant within the Development Area. However, if the franchisee fails to meet the development schedule, their development rights and the Area Development Agreement are subject to termination. The FDD also states that Black Bear Diner reserves the right to establish or license others to establish Black Bear Diner restaurants outside of the Development Area, establish other businesses (including similar restaurant concepts) within or outside the Development Area, and sell products through alternative channels of distribution to customers within the Development Area. Because of these rights that Black Bear Diner reserves, the FDD states that franchisees will not receive an exclusive territory under the Development Agreement and may face competition from other franchisees, outlets Black Bear Diner owns, or other distribution channels.