For Crown Gold Exchange, can the written approval to open be unreasonably withheld by the franchisor?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
- 6.5 Conditions to Opening. Franchisee shall notify Crown Gold Franchising at least 30 days before Franchisee intends to open the Business to the public. Before opening, Franchisee must satisfy all of the following conditions: (1) Franchisee is in compliance with this Agreement, (2) Franchisee has obtained all applicable governmental permits and authorizations, (3) the Business conforms to all applicable System Standards, (4) Crown Gold Franchising has inspected and approved the Business, (5) Franchisee has hired sufficient employees, (6) Franchisee's officers and employees have completed all of Crown Gold Franchising's required pre-opening training; and (7) Crown Gold Franchising has given its written approval to open, which will not be unreasonably withheld.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, Crown Gold Exchange will provide written approval to open a franchise, and this approval will not be unreasonably withheld. However, before opening a Crown Gold Exchange franchise, the franchisee must meet several conditions. These conditions include being in compliance with the franchise agreement, obtaining all applicable governmental permits and authorizations, ensuring the business conforms to all applicable system standards, and having Crown Gold Exchange inspect and approve the business.
Additionally, the franchisee must hire sufficient employees and ensure that their officers and employees have completed all of Crown Gold Exchange's required pre-opening training. Meeting these conditions is crucial for receiving the franchisor's written approval to open the business.
This stipulation protects prospective Crown Gold Exchange franchisees, as it prevents the franchisor from arbitrarily delaying or denying the opening of their business once all requirements have been met. It also provides a degree of assurance that as long as the franchisee fulfills their obligations, the franchisor's approval will be granted in a reasonable manner.