What are the Buildingstars restrictions on the franchisee's business location (Item 12) and how does this relate to the franchisee's obligations regarding reporting (Item 9)?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
ast the minimum amount of insurance BUILDINGSTARS requires. Regardless of the insurance amounts BUILDINGSTARS requires, it shall be the responsibility of FRANCHISEE to maintain adequate insurance coverage at all times during the term of and after the expiration of this Agreement. Failure of FRANCHISEE to maintain coverage shall not relieve it of any contractual responsibility or obligation or liability under this Agreement.
- F. Cooperation for Financial Performance Representations. FRANCHISEE shall maintain its books and records in accordance with generally accepted accounting principles, consistently applied. If BUILDINGSTARS at any time desires to utilize a financial performance representation or similar document in connection with the sale of franchises, FRANCHISEE agrees to provide BUILDINGSTARS, at no cost, with such reasonable information as BUILDINGSTARS requires from FRANCHISEE in order to properly prepare such documents, and shall permit BUILDINGSTARS to utilize such information as it deems necessary.
- G. Innovations. All ideas, concepts, techniques or materials concerning the Business, whether or not protectable intellectual property and whether created by FRANCHISEE or its owners or employees, must be promptly disclosed to BUILDINGSTARS and will be deemed to be BUILDNGSTARS' sole and exclusive property, part of the System, and works made-for-hire for BUILDINGSTARS. To the extent any item does not qualify as a "work made-for-hire" for BUILDINGSTARS, FRANCHISEE must assign ownership of that item and all related rights to that item, to BUILDINGSTARS and must take whatever action (including signing assignments or other documents) BUILDINGSTARS requests to show BUILDINGSTARS' ownership or help BUILDINGSTARS obtain intellectual property rights in the item. However, if this provision is found to be invalid or unenforceable, FRANCHISEE grants to BUILDINGSTARS a worldwide, perpetual, non-exclusive and fully paid license to use and sublicense the use of the ideas, concepts, techniques or materials.
- H. Financial Records and Reports. FRANCHISEE agrees to furnish to BUILDINGSTARS financial reports as shall be requested by BUILDINGSTARS from time to time pursuant to or in connection with this Agreement or as specified in the Confidential Operations Manual. FRANCHISEE shall establish a business checking account and will continue to maintain a business checking account throughout the term of this Agreement.
VIII. PROPRIETARY MARKS
A. Right to Use Marks.
What This Means (2025 FDD)
Based on the 2025 Buildingstars Franchise Disclosure Document, there is no information provided in the excerpts regarding specific restrictions on the franchisee's business location in Item 12, nor is there information about the franchisee's obligations regarding reporting in Item 9. However, the FDD does discuss the franchisee's obligation to provide financial reports and maintain accurate records, which are related to reporting obligations.
Specifically, Buildingstars franchisees must furnish financial reports as requested by Buildingstars, as detailed in the Confidential Operations Manual or in connection with the Franchise Agreement. Franchisees are also required to maintain a business checking account throughout the term of the agreement. Buildingstars retains the right to audit the franchisee's business records and affairs. If an audit reveals that the franchisee underreported gross sales, the franchisee will be responsible for reimbursing Buildingstars for the underpaid Account Sales Fees, Administration Fees, Royalty Fees, and Insurance Program Fees, along with interest.
Furthermore, if the underpayment exceeds 2%, the franchisee must cover all costs and expenses associated with a subsequent audit conducted by Buildingstars to ensure correct reporting. These costs include salaries of Buildingstars' representatives, travel expenses, room and board, and audit fees. Franchisees must also cooperate with Buildingstars by maintaining their books and records in accordance with generally accepted accounting principles if Buildingstars decides to use financial performance representations for franchise sales.
Since the provided excerpts do not contain the complete Item 9 or Item 12, a prospective franchisee should carefully review the full 2025 Buildingstars FDD and ask Buildingstars for clarification on the exact nature of location restrictions and reporting obligations. Understanding these aspects is crucial for assessing the operational and financial requirements of the franchise.