Does an Epcon Communities franchisee have exclusive rights to access and use the Higharc Services?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
e Franchisor's Development System, which plans Franchisor may change from time to time in accordance with the terms of the Franchise Agreement (the "Plans"); a community management tool that shows available Units and inventory Units; enhanced sales and marketing materials that allow for personalization of the Plans for each homebuyer's choices; the creation of job-specific construction drawings that match each homebuyer's structural option selections; and the generation of job-specific key measure reports for guidance in estimating quantities of materials needed for construction of a Unit (collectively, the "Higharc Services").
Franchisee, upon execution of this Addendum, shall be granted the non-exclusive right to access and use the Higharc Services, upon the terms and conditions set forth in this Addendum and the Franchise Agreement. Upon the execution of this Addendum, Franchisor shall cooperate and work with Franchisee to implement the use of the Higharc Services solely in connection with Franchisee's development of the Project and sales of the Units in the Project.
Franchisee shall at all times comply with any and all terms and conditions of Higharc related to the use of the Higharc Services. Franchisee's compliance with such terms and conditions shall be determined by Franchisor and/or Higharc in their sole discretion. In addition, as one of the conditions of its right to use the Higharc Services, Franchisee agrees to accept and abide by any conditions of use published or provided by Franchisor from time to time in connection with the Higharc Services. Franchisee's compliance with such terms and conditions shall be determined by Franchisor in its sole discretion.
Source: Item 23 — RECEIPTS (FDD pages 86–280)
What This Means (2025 FDD)
According to the 2025 Epcon Communities Franchise Disclosure Document, franchisees are granted a non-exclusive right to access and use the Higharc Services. This means that multiple franchisees can utilize these services, and Epcon Communities itself also has the right to use them. The Higharc Services are construction-related services provided through a cloud-based platform by Higharc Inc., a third party contracted by Epcon Communities. These services may include access to current versions of specified detached home plans, a community management tool, enhanced sales and marketing materials, creation of job-specific construction drawings, and generation of key measure reports for estimating material quantities.
This non-exclusive right is granted upon the execution of an addendum to the Franchise Agreement. Epcon Communities will cooperate with the franchisee to implement the use of Higharc Services specifically for the development of the franchisee's project and the sales of units within that project. However, franchisees must comply with all terms and conditions set by Higharc related to the use of these services, and Epcon Communities or Higharc has the discretion to determine whether a franchisee is meeting these requirements.
Epcon Communities retains the right to suspend, limit, or revoke a franchisee's access to Higharc Services if it determines that the franchisee has failed to comply with the requirements and obligations pertaining to the services. Despite any such suspension or revocation, the franchisee's obligation to pay the Technology Royalty continues until all amounts owed under the addendum are paid in full. This condition highlights a potential risk for franchisees, as they may lose access to the services but still be required to pay for them.
In summary, while Epcon Communities franchisees are granted access to Higharc Services, this access is non-exclusive and subject to compliance with specified terms and conditions. The franchisor maintains control over the services and can revoke access under certain circumstances, which could impact a franchisee's operations and financial obligations.