What is the required legal status of a Christian Brothers Automotive franchisee?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee is a business entity, the Principal Operator must own or control at least fifty-one percent (51%) of the ownership interest of such business entity and must have and maintain control of the business entity for as long as such entity is the Franchisee pursuant to the terms of this Agreement. Franchisee agrees to open the Franchised Business to provide services to the public on or before five days after receipt of notice from Franchisor that the Franchised Business is operational. Franchisee, its Principal Operator, and the spouse of the Principal Operator each agree not to campaign for nor hold any public office. The failure of the Principal Operator to comply with the terms of this section will constitute a material breach of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 76–372)
What This Means (2025 FDD)
According to the 2025 Christian Brothers Automotive Franchise Agreement, if the franchisee is a business entity, the Principal Operator must own or control at least 51% of the ownership interest in that entity. Furthermore, the Principal Operator must maintain control of the business entity for as long as the entity remains a franchisee under the terms of the Franchise Agreement.
This requirement ensures that a single individual has primary responsibility and control over the Christian Brothers Automotive franchise. This individual, the Principal Operator, is accountable for the daily operations and compliance with all legal requirements, the Franchise Agreement, and the Confidential Operations Manual. This structure allows Christian Brothers Automotive to maintain consistent standards and protect its brand reputation across all franchise locations.
The agreement also stipulates that the Franchisee, its Principal Operator, and the spouse of the Principal Operator each agree not to campaign for nor hold any public office. Failure of the Principal Operator to comply with these terms constitutes a material breach of the agreement. This clause ensures that the franchisee and its key personnel are fully dedicated to the operation of the Christian Brothers Automotive business and avoid potential conflicts of interest.
Prospective franchisees should carefully consider these requirements and ensure they can meet the ownership and control stipulations, as well as the commitment to focus solely on the Christian Brothers Automotive business. This level of control and dedication is typical in franchising, as franchisors seek to maintain uniformity and protect their brand standards.