Does Chocolate Bash define what constitutes the 'premises' for the purpose of sales restrictions?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Use. Tenant is a franchisee of Franchisor. The Leased Premises shall be used only for the operation of a Chocolate Bash business (or any name authorized by Franchisor).
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- Right to Enter. Upon the expiration or termination of the Franchise Agreement or the Lease, or the termination of Tenant's right of possession of the Leased Premises, Franchisor or its designee may, after giving reasonable prior notice to Landlord, enter the Leased Premises to remove signs and other material bearing Franchisor's brand name, trademarks, and commercial symbols, provided that Franchisor will be liable to Landlord for any damage Franchisor or its designee causes by such removal.
"Location" means the location stated on the Summary Page.
If no location is stated on the Summary Page, then the Location will be determined in accordance with Section 6.1.
Your franchise is for a specific location. If the specific location is not known at the time you sign a franchise agreement, then your location is subject to our approval.
You do not have the right to relocate your business, and we have no obligation to approve any request for relocation. Our policy is to approve relocation of a franchisee's business on caseby-case basis, considering factors such as changes in demographics, profitability of your current business, or a loss of your premises due to circumstances beyond your control.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 30)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, the term 'premises' is not explicitly defined for the purpose of sales restrictions. However, the FDD does define 'Location' as the site from which the franchisee is authorized to operate their Chocolate Bash business.
Item 12 discusses territory, stating that the franchise is for a specific location, which is subject to Chocolate Bash's approval if not known when signing the franchise agreement. The franchisee does not have the right to relocate the business, and Chocolate Bash has no obligation to approve any relocation request. Relocation approval is on a case-by-case basis, considering factors like demographics, profitability, or loss of premises due to circumstances beyond the franchisee's control.
Item 22 includes a clause in the lease agreement addendum that refers to the 'Leased Premises,' indicating the physical space where the Chocolate Bash business operates. This section outlines the landlord's responsibilities to Chocolate Bash Franchising, LLC in the event of default or termination of the lease. It also allows Chocolate Bash Franchising, LLC to enter the premises to remove branding materials upon termination of the franchise agreement or lease.
While the FDD does not provide a specific definition of 'premises' for sales restrictions, the 'Location' and 'Leased Premises' are defined in the agreement. A prospective franchisee should seek clarification from Chocolate Bash regarding any specific restrictions related to the physical location and its impact on sales activities.