What is the Chem-Dry franchisee prohibited from doing with the equipment other than conducting the Business pursuant to the Franchise Agreement?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
and that the Equipment conforms to the requirements set by CDI under the Franchise Agreement. CDI offers other no warranty and assigns to Franchisee any and all rights to any express or implied warranty of each Equipment manufacturer. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES ON THE EQUIPMENT OFFERED, GIVEN OR PROVIDED BY CDI INCLUDING WITHOUT LIMITATION ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
EQUIPMENT USAGE. Franchisee agrees not to use the Equipment in any business or manner other than in the conduct of the Business pursuant to the Franchise Agreement. Franchisee acknowledges that the Equipment is proprietary to the Chem-Dry franchise system. The Equipment can only be used with Chem-Dry authorized cleaning solutions and consistent with all mixing, application and usage procedures. Any usage contrary to this provision shall be considered to be a breach of the Franchise Agreement and this Agreement. In such event, CDI may demand and shall have the right to repurchase and immediate return of the Equipment from Franchisee for the purchase price of $10.00.
TRANSFER OF OWNERSHIP. Franchisee acknowledges that the Franchise Agreement imposes restrictions and limitations on the resale of the Equipment.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to the 2024 Chem-Dry Franchise Disclosure Document, a franchisee is restricted in how they use the equipment provided by Chem-Dry. Specifically, the franchisee agrees not to use the equipment in any business or manner other than in the conduct of the Chem-Dry business as outlined in the Franchise Agreement. Chem-Dry considers the equipment proprietary to its franchise system.
This means the equipment can only be used with Chem-Dry authorized cleaning solutions and in accordance with all mixing, application, and usage procedures. Any use of the equipment that goes against these provisions is considered a breach of the Franchise Agreement.
In the event of such a breach, Chem-Dry has the right to repurchase the equipment from the franchisee for a nominal price of $10.00, and the franchisee must immediately return the equipment. Additionally, the franchisee cannot sell, lease, or rent the equipment to any other party, unless it's under the conditions stated on the repurchase schedule, as provided in the Franchise Agreement, or as permitted in writing by Chem-Dry. The equipment is exclusively authorized for use within the Chem-Dry franchise network, and the franchisee cannot transfer title to the equipment except in specific ways outlined in the agreement.