How is the term 'Affiliates' defined in the Crepe De Licious agreement?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
Fund. If we terminate the Advertising Fund, we will distribute all unused contributions to contributing Franchisees, and to us or our affiliates, in proportion to respective contributions during the preceding 24-month period.
- 7.16 Internet Site. We or an affiliate will sponsor and maintain the official Crepe de licious website on the Internet. So long as you are not in default under this Agreement, we will cause your Restaurant, Kiosk, or Food Truck to be listed on this official website and/or provide you with a web page specific to your Restaurant, Kiosk, or Food Truck on this website.
- 7.17 Additional Items, Services and Suppliers. If you desire to offer additional items or services that we have not approved, or desire to purchase approved items and services from any supplier who we have not approved, we will consider any written request by you for approval of additional items, services or suppliers (although we are not obligated to approve any). You will be required to pay us for our costs incurred in any inspection or testing of any samples or any proposed new product, service or supplier nominated by you. We will notify you of our approval or disapproval of any new item, service or supplier requested by you within a reasonable time (usually within 90 days) after we have received all of the relevant information we requested. We may withhold approval of any item, service or supplier, as we determine in our discretion.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
Based on the 2025 Crepe De Licious Franchise Disclosure Document, the term 'Affiliates' is used within the agreement but not explicitly defined. The term appears in the context of rights reserved by Crepe De Licious and its affiliates regarding the use of trademarks and the system, as well as in the context of an intranet system. Specifically, Crepe De Licious retains the right for itself and its affiliates to use the Marks and System in any manner they deem advisable, without any obligation to the franchisee. Additionally, Crepe De Licious or its affiliate may establish and maintain an intranet system to assist franchisees.
This lack of a clear definition could have implications for a prospective Crepe De Licious franchisee. Without a precise definition, it may be unclear which entities are considered 'affiliates' and how broadly the franchisor can act 'on behalf of' those affiliates. This ambiguity could affect the franchisee's business, particularly concerning territorial rights, competitive activities, and support systems. For example, if an 'affiliate' engages in activities that compete with the franchisee or impacts their territory, the franchisee's recourse may be limited if the term isn't well-defined.
Therefore, a prospective Crepe De Licious franchisee should seek clarification from the franchisor regarding the definition of 'affiliates.' Understanding the scope of this term is crucial for assessing potential competitive risks and the extent to which the franchisor can act through related entities. It would be prudent to request a comprehensive list of entities considered affiliates and to understand the specific rights and obligations Crepe De Licious has concerning these affiliates.