How are Development Areas typically described for Cilantro Taco Grill franchises?
Cilantro_Taco_Grill Franchise · 2024 FDDAnswer from 2024 FDD Document
open and operate one (1) Cilantro Taco Grill outlet within the Development Area set forth in Attachment 2. Multi-Unit Operator shall be granted rights to establish additional Cilantro Taco Grill outlets in the Development Area, up to the total number of outlets set forth in the Mandatory Development Schedule set forth in Section 5.2 hereof, subject to Multi-Unit Operator's full compliance with all conditions precedent to the grant of such rights outlined below, which rights shall be exercised in accordance with Section 4.1 hereof. The Development Area is typically described in terms of municipal boundaries, county boundaries or specified trade areas within a municipality. Trade areas cannot overlap or interfere with an existing trade area, designated territories or development areas. Franchisor reserves the right to provide a two (2) mile buffer between trade areas, designated territories and development areas. Franchisor reserves the right to adjust or reassign the Development Area, including trade areas, to best serve Multi-Unit Operator's interests, or in the event there is a conflict with an existing trade area, designated territory or development area. Franchisor reserves the right to: (i) move that trade area to an unoccupied area, or (ii) refund to Multi-Unit Operator the pro-rata portion of the Development Fee that was paid for the number of outlets to be developed in those specific trade areas. The Development Rights granted to Multi-Unit Operator herein do not include the right to develop Restaurants at any Non-Traditional Sites. As used herein, a "Non-Traditional Site" includes, without limitation: gas stations or convenience stores; transportation facilities, including airports, train stations, subways and rail and bus stations; military bases and government offices; sports facilities, including stadiums and arenas; amusement parks, zoos and convention centers; car and truck rest stops and travel centers; educational facilities; recreational theme parks; hospitals; hotels; business or industrial foodservice venues; venues in which food service is or may be provided by a master concessionaire or contract food service provider; Indian reservations; casinos; or any similar captive market location.
Source: Item 23 — RECEIPT (FDD pages 52–208)
What This Means (2024 FDD)
According to Cilantro Taco Grill's 2024 Franchise Disclosure Document, a Development Area for multi-unit operators is generally defined using recognizable geographic or trade boundaries. These boundaries can include municipal boundaries, county boundaries, or specified trade areas within a municipality. This means that the Development Area is not just a random shape on a map, but rather a clearly defined region that a multi-unit operator can understand and manage.
Cilantro Taco Grill aims to prevent overlap or interference between different operators. Trade areas cannot overlap or interfere with existing trade areas, designated territories, or other development areas. To further ensure this, Cilantro Taco Grill reserves the right to implement a two-mile buffer zone between these areas. This buffer helps to avoid direct competition and potential conflicts between franchisees or operators.
Cilantro Taco Grill also retains the flexibility to adjust or reassign the Development Area to better serve the multi-unit operator's interests or to resolve conflicts with existing areas. This includes the option to move a trade area to an unoccupied location or, if necessary, refund a pro-rata portion of the development fee for outlets that cannot be developed due to conflicts. However, it's important to note that these Development Rights do not extend to Non-Traditional Sites, which include locations like gas stations, airports, military bases, and other similar venues.