Besides a confidentiality and non-compete agreement, what other restrictions is a Chocolate Fish Coffee franchisee required to place on their general manager?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
hocolate Fish Franchising shall not constitute a defense to the enforcement by Chocolate Fish Franchising of the covenants of this Section. If a Restricted Party fails to comply with the obligations under this Section during the restrictive period, then the restrictive period will be extended an additional day for each day of noncompliance.
- 13.3 General Manager and Key Employees. If requested by Chocolate Fish Franchising, Franchisee will cause its general manager and other key employees to sign Chocolate Fish Franchising's then-current form of confidentiality and non-compete agreement (unless prohibited by applicable law).
ARTICLE 14. DEFAULT AND TERMINATION
14.1 Termination by Franchisee. Franchisee may terminate this Agreement only if Chocolate Fish Franchising violates a material provision of this Agreement and fails to cure or to make substantial progress toward curing the violation within 30 days after receiving written notice from Franchisee detailing the alleged default. Termination by Franchisee is effective 10 days after Chocolate Fish Franchising receives written notice of termination.
14.2 Termination by Chocolate Fish Franchising.
(a) Subject to 10-Day Cure Period.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD page 32)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, if requested by Chocolate Fish Coffee, a franchisee must ensure that their general manager and other key employees sign Chocolate Fish Coffee's current confidentiality and non-compete agreement, unless prohibited by law.
Beyond the confidentiality and non-compete agreements, the FDD also specifies that the Business must at all times be under the on-site supervision of the Principal Executive or a general manager who has completed Chocolate Fish Coffee's training program. This means the general manager must complete the franchisor's training program to oversee the Chocolate Fish Coffee business.
Additionally, the franchisee is solely responsible for the terms and conditions of employment, including recruiting, hiring, training, scheduling, supervising, compensation, and termination of the general manager. The franchisee is also solely responsible for all actions of its personnel. Chocolate Fish Coffee and the franchisee are not joint employers, and no employee of the franchisee will be an agent or employee of Chocolate Fish Coffee.