Under what circumstances can a Dryer Vent Squad franchisee delegate management functions?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
14.D. DEATH OR DISABILITY OF FRANCHISEE OR AN OWNER
(1) If Franchisee is an individual and not a Corporate Entity, upon the death or permanent disability of Franchisee, the executor, administrator, conservator or other personal representative of Franchisee, must appoint a manager that meets the equivalent of an Operating Manager within a reasonable time, which shall not exceed 30 days from the date of death or permanent disability. The appointed manager (as applicable) must serve and qualify as an Operating Manager and attend and successfully complete the Training Program within 60 days of the appointment. If Franchisee's Dryer Vent Squad Business is not being managed by a Franchisor approved Operating Manager (as applicable) within 30 days after such death or permanent disability, Franchisor is authorized, but is not required, to immediately appoint a manager to maintain the operations of Franchisee's Dryer Vent Squad Business for, and on behalf of, Franchisee at Franchisee's sole costs until an approved Operating Manager is able to assume the management and operation of Franchisee's Dryer Vent Squad Business. Franchisor's appointment of a manager for Franchisee's Dryer Vent Squad
Business does not relieve Franchisee of its obligations under this Agreement, including this Article 14.D., or constitute a waiver of Franchisor's right to terminate this Agreement pursuant to Article 16, below. At all times, including while Franchisee's Dryer Vent Squad Business may be managed by Franchisor's appointed manager, Franchisor shall not be liable for any debts, losses, costs, or expenses incurred in the operations of Franchisee's Dryer Vent Squad Business or to any creditor of Franchisee for any products, materials, supplies or services purchased by Franchisee's Dryer Vent Squad Business. Franchisor has the right to charge a reasonable fee (the "Management Service Fees") for such management services and may cease to provide management services at any time.
- (2) If Franchisee is a Corporate Entity, upon the death or permanent disability of Franchisee's Managing Owner, the remaining Owners within a reasonable time, which shall not exceed 30 days from the date of death or permanent disability, must appoint a new Managing Owner that is approved by Franchisor.
The appointed Managing Owner must attend and successfully complete the Training Program within 60 days of the appointment.
If Franchisee's Dryer Vent Squad Business is not being managed by a Franchisor approved Managing Owner (as applicable) within 30 days after such death or permanent disability, Franchisor is authorized, but is not required, to immediately appoint a manager to maintain the operations of Franchisee's Dryer Vent Squad Business for, and on behalf of, Franchisee at Franchisee's sole costs until an approved Managing Owner is able to assume the management and operation of Franchisee's Dryer Vent Squad Business.
Franchisor's appointment of a manager for Franchisee's Dryer Vent Squad Business does not relieve Franchisee of its obligations under this Agreement, including this Article 14.D., or constitute a waiver of Franchisor's right to terminate this Agreement pursuant to Article 16, below.
At all times, including while Franchisee's Dryer Vent Squad Business may be managed by Franchisor's appointed manager, Franchisor shall not be liable for any debts, losses, costs, or expenses incurred in the operations of Franchisee's Dryer Vent Squad Business or to any creditor of Franchisee for any products, materials, supplies or services purchased by Franchisee's Dryer Vent Squad Business.
Franchisor has the right to charge a reasonable fee for such management services and may cease to provide management services at any time.
Notwithstanding the foregoing, if Franchisee is a Corporate Entity and the Managing Owner is the only Owner of Franchisee, then Article 14.D.(1) shall apply as if the Managing Owner were the sole individual Franchisee.
Source: Item 23 — RECEIPTS (FDD pages 51–207)
What This Means (2024 FDD)
According to Dryer Vent Squad's 2024 Franchise Disclosure Document, a franchisee's ability to delegate management functions depends on whether the franchisee is an individual or a corporate entity. If the franchisee is an individual and not a corporation, in the event of death or permanent disability, their representative must appoint a manager approved by Dryer Vent Squad within 30 days. This manager must then complete the required training program within 60 days of appointment. If a suitable manager is not appointed, Dryer Vent Squad has the option to appoint a manager at the franchisee's expense until an approved manager is in place.
If the Dryer Vent Squad franchisee is a corporate entity, similar rules apply upon the death or permanent disability of the Managing Owner. The remaining owners must appoint a new Managing Owner approved by Dryer Vent Squad within 30 days, who must then complete the training program within 60 days. If no approved Managing Owner is in place after 30 days, Dryer Vent Squad can appoint a manager at the franchisee's cost until a suitable replacement is found. This appointed manager does not relieve the franchisee of their obligations under the agreement, and Dryer Vent Squad is not liable for any debts or expenses incurred during this period.
In both scenarios, Dryer Vent Squad retains the right to charge a reasonable fee for their management services and can discontinue these services at any time. These provisions ensure the continued operation of the Dryer Vent Squad business in unforeseen circumstances while maintaining the standards and control of the Dryer Vent Squad brand. It is important to note that if the Managing Owner is the only owner of a corporate entity, the rules for individual franchisees apply.