Under the Cinch I.T. Multi-Unit Development Agreement, what is attached as Addendum A?
Cinch_I_T Franchise · 2024 FDDAnswer from 2024 FDD Document
Under the Development Agreement, you will receive a Development Area, which will be mutually agreed upon by us and you. A description of the Development Area will be attached as Addendum A to the Multi-Unit Development Agreement. The Development Area will be determined by the number of franchises agreed upon multiplied by the Designated Territory business population each containing an approximate of 3,000 to 3,500 qualified businesses as defined below. By example a Development Area for four franchises would contain a business population of 12,000 to 14,000 qualified businesses. Once a Development Area is granted you may not relocate any franchised business.
The Development Agreement is not a license or franchise agreement. It does not give you the right to operate a CINCH I.T. franchised business or use the System or the Marks, nor does it give you any right to license others to operate CINCH I.T. businesses. The Development Agreement does not provide a right of first refusal nor similar right to obtain additional franchises within your Development Area.
Source: Item 12 — TERRITORY (FDD pages 39–43)
What This Means (2024 FDD)
According to Cinch I.T.'s 2024 Franchise Disclosure Document, Addendum A to the Multi-Unit Development Agreement contains a description of the Development Area. The Development Area is determined through mutual agreement between Cinch I.T. and the franchisee. The size of the Development Area is based on the number of franchises agreed upon, multiplied by the Designated Territory business population.
In practical terms, this means that if you enter into a Multi-Unit Development Agreement with Cinch I.T., the specific geographic area where you will be developing multiple franchise locations will be detailed in Addendum A. The size of this area will depend on how many franchises you plan to open and the density of qualified businesses (those with 10 or more employees) within that area. For example, a Development Area for four franchises would contain a business population of 12,000 to 14,000 qualified businesses.
It's important to note that the Development Agreement itself does not grant you the right to operate a Cinch I.T. franchise or use their system and marks. It also does not provide a right of first refusal for additional franchises within your Development Area. The Development Agreement solely defines the area in which you have the right to develop franchises, subject to the terms and conditions outlined in the agreement.