What is the dependency between the Chem-Dry Franchise Agreement and the COA?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
3, 15, 17, 18, 19, 20, 21 and 22 in the Agreement shall survive the termination of the Agreement.
| If Individuals: | If an Entity: |
|---|---|
| FRANCHISEE – | Name of Entity |
| Individually and Personally | |
| FRANCHISEE – | By: |
| Individually and Personally | Its: |
| CHEM-DRY, INC. | |
| By: | |
| Its: | |
| Date: |
EXHIBIT D TO FRANCHISE AGREEMENT
CONSOLIDATED OFFICE AGREEMENT
THIS CONSOLIDATED OFFICE AGREEMENT ("COA") is made and entered into the Effective Date, by and between CDI and Franchisee.
WITNESSETH:
WHEREAS, Franchisee is the owner of multiple Chem Dry® franchises ("Franchises") situated in different designated franchised areas;
WHEREAS, the Chem-Dry franchise agreements ("Agreements") between Franchisee and CDI pertaining to the Franchises requires Franchisee to establish an office location within each franchised area and to operate the Franchises from each office location;
WHEREAS, Franchisee desires to establish only one office located in one of its franchised areas and to operate all of the Franchises from that single office location; and
WHEREAS, CDI is willing to grant an exception to the office location requirement in the Agreements, on a limited, non transferrable, and revocable basis.
NOW, THEREFORE, in consideration of the mutual promises made herein, CDI and Franchisee agree to be bound by the following terms and conditions
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- Unless this COA is signed in conjunction with the sale of a new Chem-Dry franchise, Franchisee agrees to pay CDI a nonrefundable administration fee of $500.00 as consideration for the privilege of headquartering all Franchises from a single office location.
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- This COA will expire with the Franchise Agreement, and is non renewable and non-transferrable.
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- Pursuant to section 11 of the Agreements, Franchisee agrees to maintain and preserve full and accurate books for each franchise headquartered at the single office location.
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- Upon expiration of this COA, Franchisee may be eligible to enter into a second COA with CDI so long as Franchisee notifies CDI of its desire to do so at least sixty (60) days prior to the expiration of this COA. Any subsequent COAs will be upon then current terms and conditions and will require payment of the then current fee. Upon expiration of this COA and if CDI does not enter into a new COA with Franchisee, Franchisee will have until the expiration date of this COA to move all franchise operations to office locations within the designated franchised areas for each Franchise. Failure to do so within the timeframe will be a material breach of the Agreement for that Franchise. Franchisee acknowledges and agrees CDI has no obligation to enter into subsequent COAs with Franchisee and that doing so will be at CDI's sole discretion.
tered into by CDI solely as an accommodation to Franchisee and CDI may terminate this COA, with or without cause, upon sixty (60) days written notice to Franchisee.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem-Dry's 2024 Franchise Disclosure Document, the Consolidated Office Agreement (COA) is directly linked to the Chem-Dry Franchise Agreement. The COA allows a franchisee with multiple Chem-Dry franchises to operate all of them from a single office location, which is an exception to the standard requirement of having an office in each franchised area. This exception is granted on a limited, non-transferable, and revocable basis.
The COA's term is tied to the Franchise Agreement, expiring simultaneously and is non-renewable and non-transferable. If a franchisee wants to continue operating under a COA, they must notify Chem-Dry at least sixty days before the current COA expires and enter into a new agreement, which will be subject to the then-current terms and fees. Chem-Dry retains the discretion to refuse to enter into subsequent COAs. If a new COA is not established, the franchisee must move each franchise's operations to an office within its designated franchised area by the COA's expiration date, or it will be considered a breach of the Franchise Agreement.
Chem-Dry can terminate the COA at any time, with or without cause, by providing sixty days' written notice. If the COA is terminated, the franchisee must relocate all franchise operations to their respective designated areas within the timeframe specified in Chem-Dry's notice. Furthermore, if the Franchise Agreement for the location where the franchisee's single office is situated terminates or expires, the franchisee must immediately move the office to another location approved by Chem-Dry. In the event of any conflict between the COA and the Franchise Agreements, the terms of the Franchise Agreements will take precedence.