Where can I find a description of the sublicense arrangement within the Epcon Communities Franchise Agreement?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
We acknowledge that real estate developers often form a separate business entity for each of their projects to isolate each of their business endeavors. On the condition that the individual ownership of the entities remains the same or substantially similar, and as an accommodation to you to simplify the paperwork involved with forming a separate business entity for each project, we use the Sublicense Agreement (see Exhibit H to this disclosure document) as a legal mechanism to evidence the contractual relationship between your initial business entity, your new business entity, and us. Also, when the Sublicense Agreement is signed, your new business entity does not pay an initial franchise fee to us (or any other consideration) for the grant of the rights to your new entity to develop your project. We do not grant to you the right to sell or negotiate the sale of franchises in our name or receive any consideration from your new entity with respect to the grant of these rights. The nature of the sublicense arrangement is described in Section 12.5 of the Franchise Agreement.
Source: Item 12 — TERRITORY (FDD pages 48–50)
What This Means (2025 FDD)
According to the 2025 Epcon Communities Franchise Disclosure Document, details regarding the sublicense agreement can be found within Item 12, specifically referencing Section 12.5 of the Franchise Agreement. Epcon Communities uses the Sublicense Agreement (Exhibit H) to evidence the contractual relationship between your initial business entity, your new business entity, and them.
The sublicense agreement is used when real estate developers form separate business entities for each project. As long as the individual ownership of the entities remains substantially similar, Epcon Communities uses the Sublicense Agreement to simplify paperwork. When a Sublicense Agreement is signed, the new business entity does not pay an initial franchise fee or any other consideration to Epcon Communities for the rights to develop the new project.
It is important to note that Epcon Communities does not grant franchisees the right to sell or negotiate the sale of franchises in their name, nor can franchisees receive any consideration from their new entity for granting these rights. The sublicense is merely a legal mechanism to allow development under an existing franchise agreement when a new business entity is created for a specific project.