What is the required action for a Crawlspace Medic developer to open each Crawlspace Medic outlet?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
imited liability company, corporation or partnership, for the sole purpose of entering into a Franchise Agreement and operating the Crawlspace Medic outlet pursuant thereto, provided that Developer shall also personally sign such Franchise Agreement as a principal.
5 EXERCISE OF DEVELOPMENT RIGHTS.
5.1 Valid Exercise. Developer shall exercise the development rights granted hereunder only by entering into a separate Franchise Agreement with Franchisor for each Crawlspace Medicoutlet for which a development right is granted. Developer shall execute and deliver to Franchisor, concurrently with the execution and delivery of this Agreement, Franchisor's current form of Franchise Agreement for the first Crawlspace Medic outlet to be established by Developer pursuant to the Mandatory Development Schedule. For each subsequent Crawlspace Medic outlet to be established hereunder, Developer shall execute and deliver to Franchisor Franchisor's then-current form of Franchise Agreement, which shall be presented to Developer together with Franchisor's then-current Franchise Disclosure Document. The then-current form of Franchise Agreement may differ from the current form of Franchise Agreement; provided however, the initial franchise fee for each additional outlet shall be the applicable amount set forth in in Section 4.1 hereof.
Further, Developer acknowledges and agrees that Developer shall not receive any initial training related to each additional Crawlspace Medic outlet. Developer hereby waives all obligations by Franchisor to provide any training to Developer contained in each Franchise Agreement, other than the initial Franchise Agreement executed concurrently with this Agreement, by and between Franchisor and Developer. Developer hereby acknowledges and agrees that the training Developer receives pursuant to the initial Franchise Agreement executed concurrently with this Agreement is sufficient to allow Developer to construct, equip, open and operate each of Developer's Crawlspace Medic outlets in the Development Area.
5.2 Mandatory Development Schedule.On a multiple store development agreement, the second location must be open within 1 year of the opening of the first location and all additional locations must be open at a minimum of every year thereafter until the development agreement has been satisfied. Consideration will be granted if there is a natural disaster, imposed government restrictions, or other uncontrollable acts of nature which strongly inhibit the franchisee from satisfying this requirement. All time extension requests must be submitted in writing to the franchisor within 30 days prior to the year deadline for consideration. The franchisor will have 10 days to respond in writing as to whether the request for extension will be granted. Subsequent to Developer's signing of this Agreement and the initial Franchise Agreement, and provided that all conditions in Section 5.4 hereof are satisfied or waived, upon the execution of a lease for Developer's first Crawlspace Medic outlet, Developer shall execute an additional Franchise Agreement for the development of the second Crawlspace Medic outlet to be opened under the Mandatory Development Schedule.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2024 FDD)
According to the 2024 Crawlspace Medic Franchise Disclosure Document, a developer must enter into a separate Franchise Agreement with Crawlspace Medic for each outlet they plan to open. This is how the developer exercises their rights under the Multi-Unit Development Agreement. Concurrently with signing the Development Agreement, the developer must also execute the current Franchise Agreement for the first Crawlspace Medic outlet. For each subsequent outlet, the developer will execute the then-current Franchise Agreement, which may differ from the initial agreement and will be presented alongside the current Franchise Disclosure Document. The initial franchise fee for each additional outlet will be the amount specified in Section 4.1 of the agreement.
Before Crawlspace Medic grants the developer the right to develop an additional outlet, several conditions must be met or waived by Crawlspace Medic. The developer must request the current Franchise Disclosure Document, submit all required information and documents, provide requested financial statements, and meet Crawlspace Medic's current financial criteria for multi-unit franchisees. The developer must also be in full compliance with the Development Agreement, the Mandatory Development Schedule, all Franchise Agreements, and any other agreements with Crawlspace Medic or its affiliates. Additionally, the developer must demonstrate the necessary management skills for competent operation, organization, customer service, and record keeping of an additional Crawlspace Medic outlet, as determined by Crawlspace Medic.
Crawlspace Medic may determine that a physical location is not required for each Franchise Agreement that is part of the Development Agreement. If this is the case, the Mandatory Development Schedule in section 5.2 refers to the date the developer begins operating. Failure to meet these conditions gives Crawlspace Medic the right to terminate the Development Agreement, though this termination will not affect any other agreements between Crawlspace Medic and the developer, provided the developer is in full compliance with those agreements.