According to the Bombs Away FDD, what does the term 'you' refer to?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
If Franchisee obtains a customer in the protected territory of another franchisee, then, in addition to all other rights and remedies Bombs Away Franchising may have, Bombs Away Franchising may in its discretion (i) require Franchisee to transfer the customer to such other franchisee, (ii) require Franchisee to pay such other franchisee 75% of the Gross Sales received from such customer, or (iii) fashion such other remedy as Bombs Away Franchising deems appropriate.
- (e) Referrals.
Bombs Away Franchising may set policies binding on all franchisees regarding referral fees (and other terms and conditions) when a customer is referred from one Bombs Away business to another.
Bombs Away Franchising may waive or modify such policies in any circumstance as Bombs Away Franchising determines.
- 2.3 Franchisee Control. Franchisee represents that it will identify each owner, officer and director of Franchisee, and describes the nature and extent of each owner's interest in Franchisee.
If any of this information changes, Franchisee shall notify Franchisor within 10 days.
- 2.4 Principal Executive. Franchisee agrees that the person designated as the "Principal Executive" on the Summary Page is the executive primarily responsible for the Business and has decision-making authority on behalf of Franchisee.
The Principal Executive must have at least 10% ownership interest in Franchisee.
The Principal Executive must participate in the direct operation of the Business and must devote substantial time and attention to the Business.
If the Principal Executive dies, becomes incapacitated, transfers his/her interest in Franchisee, or otherwise ceases to be the executive primarily responsible for the Business, Franchisee shall promptly designate a new Principal Executive, subject to Bombs Away Franchising's reasonable approval.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 7–8)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, the term "you" generally refers to the franchisee. This is evident within the context of various clauses outlining the franchisee's responsibilities, rights, and obligations under the franchise agreement. For instance, the agreement specifies actions that the franchisee must take, such as using trademarks in compliance with Bombs Away's requirements, complying with changes to marks, and disclosing innovations to Bombs Away Franchising. These stipulations directly concern the franchisee's conduct and operational practices.
Furthermore, the FDD details scenarios where the franchisee's actions have specific consequences. For example, if the franchisee obtains a customer in another franchisee's protected territory, Bombs Away Franchising has the discretion to require the franchisee to transfer the customer or pay a percentage of gross sales to the other franchisee. Similarly, upon termination or expiration of the agreement, the franchisee has obligations such as paying outstanding amounts, returning confidential information, and ceasing business under the Bombs Away marks. These clauses underscore that "you" refers to the franchisee, who is bound by these contractual terms.
In essence, the consistent use of "you" in conjunction with duties, restrictions, and entitlements related to operating the Bombs Away franchise confirms that it is directed at the franchisee. A prospective franchisee should carefully review all sections of the franchise agreement where "you" is used to fully understand their responsibilities and the potential implications of their actions under the Bombs Away franchise system.