Where does the Endless Summer Sweets franchise agreement specify the rights of the franchisor?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
this Agreement is signed, then the parties will determine the Location in accordance with Section 6.1 of this Agreement. Franchisee shall develop, open and operate the Endless Summer Sweets business at the Location for the entire term of this Agreement.
- 2.2 Protected Territory. Franchisor shall not establish, nor license or franchise the establishment of, another business within the Territory selling the same or similar goods or services under the same trademarks or service marks as an Endless Summer Sweets business. Franchisor retains the right to:
- (i) establish and license others to establish and operate Endless Summer Sweets businesses outside the Territory, notwithstanding their proximity to the Territory or their impact on the Business;
- (ii) operate and license others to operate businesses anywhere that do not operate under the Endless Summer Sweets brand name; and
- (iii) sell and license others to sell products and services in the Territory through channels of distribution (including the internet) other than Endless Summer Sweets outlets.
- 2.3 Franchisee Control. Franchisee represents that it will identify each owner, officer and director of Franchisee, and describes the nature and extent of each owner's interest in Franchisee. If any of this information changes, Franchisee shall notify Franchisor within 10 days.
- 2.4 Principal Executive. Franchisee agrees that the person designated as the "Principal Executive" on the Summary Page is the executive primarily responsible for the Business and has decision-making authority on behalf of Franchisee. The Principal Executive must have at least 10% ownership interest in Franchisee. The Principal Executive does not have to serve as a day-today general manager of the Business, but the Principal Executive must devote substantial time and attention to the Business. If the Principal Executive dies, becomes incapacitated, transfers his/her interest in Franchisee, or otherwise ceases to be the executive primarily responsible for the Business, Franchisee shall promptly designate a new Principal Executive, subject to Franchisor's reasonable approval.
- 2.5 Guaranty. If Franchisee is an entity, then Franchisee shall have each Owner sign a personal guaranty of Franchisee's obligations to Franchisor, in the form of Exhibit 3 to this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets Franchise Disclosure Document, the rights of the franchisor, Endless Summer Sweets Franchising, Inc., are detailed throughout the franchise agreement. Endless Summer Sweets retains specific rights regarding the establishment and licensing of other businesses. Specifically, Endless Summer Sweets has the right to establish and license others to establish and operate Endless Summer Sweets businesses outside the franchisee's territory, even if they are near the franchisee's territory or impact their business. Endless Summer Sweets also retains the right to operate and license others to operate businesses that do not operate under the Endless Summer Sweets brand name anywhere. Additionally, Endless Summer Sweets can sell and license others to sell products and services in the franchisee's territory through different channels of distribution, including the internet, that are not Endless Summer Sweets outlets.
Endless Summer Sweets also has rights regarding the lease of the premises where the Endless Summer Sweets business operates. The landlord must provide Endless Summer Sweets with copies of any default notices given to the franchisee and grants Endless Summer Sweets the option to cure any default under the lease if the franchisee fails to do so within ten days. If the landlord terminates the lease due to the franchisee's default, Endless Summer Sweets has the option to enter into a new lease with the landlord under the same terms as the original lease, provided they notify the landlord within fifteen days of receiving the termination notice. If the Franchise Agreement is terminated, Endless Summer Sweets can request the franchisee to assign the lease to them, which the landlord consents to.
Endless Summer Sweets also has the right to modify the system standards. The franchise agreement specifies that any modification or amendment to the agreement must be in writing and signed by both parties. However, this provision does not limit Endless Summer Sweets's rights to modify the Manual or System Standards. This allows Endless Summer Sweets to adapt and evolve its operating procedures and standards without requiring a formal amendment to the franchise agreement itself. These rights collectively ensure that Endless Summer Sweets maintains control over its brand, operational standards, and market presence, while also providing some level of protection and recourse in the event of franchisee default or lease termination.