Does Section 6 of the Burros Fries Franchise Agreement relate to the Franchisee's Territory?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
that Franchisee shall not violate any applicable law, regulation or provision of this Agreement in exercising such discretion.
6. TERRITORY
Franchisee is not granted an exclusive territory. The Franchisee is granted a Territory that is a protected territory as defined in this Agreement. The location of the Franchise Business shall be as the parties agree, usually about a radius of three (3) miles. If the actual Franchise Business address has not yet been chosen by the time the parties sign the Franchise Agreement they shall agree upon a temporary territory. The final Territory will be defined from the actual Business address once chosen.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
Yes, according to the 2024 Burros Fries Franchise Disclosure Document, Section 6 of the Franchise Agreement pertains to the franchisee's territory. The document states that the franchisee is granted a protected territory, as defined in the agreement. The location of the Burros Fries business is typically agreed upon as a radius of three miles. If the business address isn't chosen when the agreement is signed, a temporary territory is agreed upon until the final location is determined.
The protected territory for a Burros Fries business not in a non-traditional location is defined by a specified number of miles driven from any direction of the business. The territory's determination considers factors like population, demographics, traffic, proximity to major roads, parking, competition, business potential, site availability, square footage, and reasonable rent. Once a location is approved by Burros Fries, the territory is set and won't change, even if the population increases or decreases during the agreement term. The territory boundaries are determined by major topographical features like streets, highways, rivers, and mountains, with Burros Fries deciding the size and boundaries of the protected territory.
Burros Fries emphasizes that the franchisee's rights within the territory are strictly limited to what is outlined in Section 6. The franchisee cannot exclude, control, or impose conditions on other Burros Fries units or distribution channels, whether franchised or company-owned. These limitations extend to other related businesses or services that Burros Fries or its affiliates may be involved in. The franchisor retains rights not expressly granted to the franchisee, including operating other businesses (not substantially similar to Burros Fries) within the territory, selling branded products through other channels, and developing other concepts or franchise systems.