Are the rights and remedies set forth in the Dog Haus franchise agreement exclusive?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
and the Dog Haus System to develop, open and operate the cumulative number of Dog Haus Restaurants set forth in Exhibit A in the Development Area during the Term. Except as provided in Section 2.6, Area Developer may not develop, open or operate more Dog Haus Restaurants than the number of Dog Haus Restaurants set forth on Exhibit A during the Term. Area Developer shall not subcontract, sublicense, share, divide or partition this Agreement or enter into any agreement with any third party providing for the right to develop, open or operate Dog Haus Restaurants or to use the Dog Haus Marks or the Dog Haus System and nothing in this Agreement will be construed as granting Area Developer the right to do so. The Parties shall execute Franchisor's Then-Current Franchise Agreement for each Dog Haus Restaurant to be developed, opened and operated by Area Developer under this Agreement, the form of which may differ from the form of Dog Haus Franchise Agreement attached to Franchisor's Franchise Disclosure Document (the "Disclosure Document") provided to Area Developer prior to the Effective Date.
- Exclusive License. Except as otherwise provided in this Section 2.2 and in Section 2.4, the rights granted to Area Developer under this Agreement are exclusive during the Term so long as Area Developer is in Good Standing and neither Franchisor nor any of its Affiliates shall themselves develop, open and operate, or grant third parties the right to develop, open and operate, Dog Haus Restaurants in the Development Area during the Term. Area Developer acknowledges the Development Area may be subject to pre-existing franchises granted prior to the Effective Date. The Development Area will not contain any areas granted to other franchisees prior to the Effective Date. Existing franchisees may renew or transfer the franchise rights previously granted to them under their Area Development Agreements or Franchise Agreements.
- Adherence to Development Schedule. Area Developer shall satisfy the Minimum Development Obligation by Opening the number of Dog Haus Restaurants in the Development Area within each Development Period as required by the Development Schedule set forth on Exhibit A and by continuing to operate the cumulative number of Dog Haus Restaurants required by the Minimum Development Obligation. Failure to comply with the Development Schedule shall constitute a Default under this Agreement and shall entitle Franchisor to terminate this Agreement, unless the Default results from an event of Force Majeure, in which case, the deadline to Opening a Dog Haus Restaurant may be extended by Franchisor as provided in Section 2.7.
- Rights Reserved by Franchisor. Except as expressly provided in Section 2.2, Franchisor expressly reserves all other rights, including the exclusive, unrestricted right, in its discretion, directly and indirectly, through its
employees, Affiliates, representatives, licensees, assigns, agents and others, to (i) develop, own and operate, and to grant franchises to third parties to develop, open and operate, Dog Haus Restaurants outside the Development Area, regardless of their proximity to the Development Area; (ii) develop, open and operate, and to grant franchises to third parties to develop, open and operate any other business, including a beverage and snack or food business, other than a Competitive Business, under marks and systems different from the Dog Haus Marks and the Dog Haus System within and outside the Development Area; (iii) sell or distribute, at retail or wholesale, directly or indirectly, or license others to sell or distribute, Dog Haus Branded Products and Dog Haus Proprietary Products within and outside the Development Area, through the Internet, mail order catalogs, direct mail advertising, catering and through other distribution methods;
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, the rights granted to an Area Developer are exclusive during the term of the agreement, provided the Area Developer remains in good standing. This exclusivity means that neither Dog Haus nor its affiliates can develop, open, or operate Dog Haus restaurants, or grant others the right to do so, within the designated Development Area during the agreement's term. However, this exclusivity is subject to certain pre-existing conditions and rights that Dog Haus retains.
Specifically, the Development Area may be subject to franchises granted before the effective date of the agreement. Existing franchisees may also renew or transfer their previously granted franchise rights. Dog Haus also reserves several rights, including the ability to develop, own, and operate Dog Haus restaurants outside the Development Area, regardless of proximity. They can also operate other businesses (excluding Competitive Businesses) under different marks and systems, and sell or distribute Dog Haus branded products through various channels, both within and outside the Development Area.
Dog Haus also retains the right to market on the Internet, operate at Non-Traditional Venues, acquire similar businesses, and be acquired by other businesses, even those that operate Competitive Businesses. These reserved rights and pre-existing agreements could potentially impact the Area Developer's exclusive rights, as Dog Haus can still engage in various activities that might compete with or affect the Area Developer's business, albeit outside the specific scope of directly franchising Dog Haus restaurants within the Development Area. Therefore, while the Area Developer has certain exclusive rights, these are limited by the rights Dog Haus retains and the pre-existing franchise agreements.