Does the Dryer Vent Squad Franchise Agreement include an Operating Territory Acknowledgment?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
[Item 23: RECEIPTS]
- (1) During the Term of this Agreement and subject to the rights of Franchisor including, but not limited to, the Reserved Rights, Franchisor grants to Franchisee and Franchisee accepts, the nonexclusive license, right and obligation to develop and operate a Dryer Vent Squad Business within the operating territory designated and set forth in Schedule 1 of this Agreement (the "Operating Territory"). If Schedule 1 does not specifically identify and designate an Operating Territory, and/or if Schedule 1 is not signed by Franchisor, the Operating Territory shall be determined by Franchisor in Franchisor's Reasonable Business Judgment;
- (2) The Operating Territory shall be comprised of and qualify as either a Single Territory or a Double Territory, with such designation and determination being made and identified in Schedule 2 of this Agreement;
- (3) Franchisee's Administrative Office must be located within the Operating Territory and be approved by Franchisor;
- (4) Franchisee may only operate the Franchised Business within Franchisee's Operating Territory and, without limitation to the foregoing, Franchisee may only offer and sell the Approved Services and Products within Franchisee's Operating Territory, the System standards designated by Franchisor, and in accordance with the requirements designated by Franchisor in the Operations Manual;
- (5) Except as otherwise provided in this Agreement including, but not limited to, the Reserved Rights and Closed Markets, provided that, at all times, Franchisee is and remains in compliance with the terms of this Agreement, during the Term of this Agreement, Franchisor will not and Franchisor's affiliates will not operate, or grant a franchisee the right to operate a Dryer Vent Squad Business using the Licensed Marks and System within Franchisee's Operating Territory, provided that an Operating Territory has been designated and approved by Franchisor in accordance with the terms of this Agreement; and
- (6) The foregoing rights granted in this Article 2.A. are subject to and contingent upon each and every, term and condition of this Agreement, the rights of any prior user, and are non-exclusive and subordinate to the Reserved Rights.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to the 2024 Dryer Vent Squad Franchise Disclosure Document, the Franchise Agreement does include an Operating Territory.
Specifically, when signing the Franchise Agreement, Dryer Vent Squad will designate the franchisee's Operating Territory. The size of this territory varies based on local factors, market conditions, and whether the franchisee selects a Single or Double Territory. A Single Territory generally includes a population of approximately 250,000 to 350,000 people, while a Double Territory includes approximately 750,000 to 1,000,000 people. The franchisee's Minimum Monthly Royalty Fee Requirement and local marketing expenditure will vary depending on if they purchase a Single Territory or a Double Territory.
During the term of the Franchise Agreement, provided the franchisee is not in default, Dryer Vent Squad will not operate or grant another franchise the right to operate a Dryer Vent Squad Business using the Licensed Marks and System within the franchisee's Operating Territory. However, this is subject to certain Reserved Rights of Dryer Vent Squad, including the right to operate and grant franchises outside the franchisee's Operating Territory and to engage in other business activities, even those that may compete with the franchisee's business. The franchisee's administrative office must be located within the Operating Territory and be approved by Dryer Vent Squad.