What does the Extreme Art Studio Franchise Agreement define regarding the 'GRANT AND TERM OF FRANCHISE'?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
1.4 GRANT AND TERM OF FRANCHISE.
- 1.4.1 Subject to all of the terms and conditions of this Franchise Agreement, we grant you a franchise to operate an Extreme Art Studio Business (1) a single Extreme Art Studio Business ("Single Franchise"); (2) up to two Extreme Art Studio Businesses ("Multi-2"); or (3) up to three Extreme Art Studio Businesses ("Multi-3") (collectively, the Multi-2 and Multi-3 are referred to as "Standard Franchise(s)").
If we grant you a Standard Franchise, you must sign our Multi-Franchise Addendum the form of which is attached to the Franchise Disclosure Document in Exhibit H.
Prior to opening the second and each subsequent Extreme Art Studio Business under a Standard Franchise, you and we will execute the then-current form of Extreme Art Rider ("Extreme Art Rider"), the current form of which is attached to this Franchise Agreement in Attachment E but which may vary materially and substantially from the form attached to this Franchise Agreement.
If you operate multiple Extreme Art Studio Businesses, each reference to the "Franchised Business" herein shall refer to each individual Extreme Art Studio Business that you operate under this Franchise Agreement, unless otherwise specified.
All obligations under this Franchise Agreement shall apply individually to each Extreme Art Studio Business you operate.
- 1.4.2 We must authorize the specific location for your Studio (each an "Approved Location").
The Approved Location for your initial Extreme Art Studio Business will be designated in Attachment B, and the Approved Location for any additional Extreme Art Studio Businesses will be specified in the Extreme Art Rider applicable thereto.
If the Approved Location for your initial Extreme Art Studio Business has not been selected and approved at the time this Franchise Agreement is signed, or the Approved Location for any of your subsequent Extreme Art Studio Businesses have not been selected and approved at the time the Extreme Art Rider applicable thereto is signed, Attachment B (with respect to the initial Extreme Art Studio Business) or the applicable Extreme Art Rider (with respect to any subsequent Extreme Art Studio Business) will describe the Approved Location in general terms.
When we subsequently approve a location for your Extreme Art Studio Business, we will complete Attachment B-1 or our then-current form of Attachment E-1, as applicable, to specify the address of that location, and such location will automatically become the Approved Location for the applicable Extreme Art Studio Business as if originally set forth in Attachment B or the Extreme Art Rider.
Although we may assist you, you are solely responsible for selecting each Approved Location and negotiating the lease or purchase terms for each of your Extreme Art Studio Businesses.
You agree that you are not guaranteed any specific Approved Location for any of your Extreme Art Studio Businesses, and you may not be able to obtain your top choice for any of your Extreme Art Studio Businesses.
You and we must reach agreement on an Approved Location for your Studio within four months after you sign this Franchise Agreement, or we have the option to terminate this Franchise Agreement.
- 1.4.3 The term of this Franchise Agreement begins on the Effective Date and expires ten years from that date, unless sooner terminated as provided herein.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, the franchise agreement outlines the grant and term of the franchise in Section 1.4. Extreme Art Studio grants the franchisee the right to operate either a single Extreme Art Studio Business, up to two businesses (Multi-2), or up to three businesses (Multi-3), with the latter two collectively referred to as Standard Franchises. If a franchisee is granted a Standard Franchise, they must sign a Multi-Franchise Addendum.
Prior to opening the second and any subsequent Extreme Art Studio Business under a Standard Franchise, the franchisee and Extreme Art Studio will execute the then-current form of Extreme Art Rider. The current form of the Extreme Art Rider is attached to the Franchise Agreement in Attachment E, but the document notes that this form may vary materially and substantially from the form attached to the Franchise Agreement. Each reference to the 'Franchised Business' refers to each individual Extreme Art Studio Business operated under the Franchise Agreement, unless otherwise specified, and all obligations apply individually to each business.
The franchise agreement also states that Extreme Art Studio must authorize the specific location for the studio, referred to as the 'Approved Location.' The Approved Location for the initial Extreme Art Studio Business will be designated in Attachment B, while locations for additional businesses will be specified in the applicable Extreme Art Rider. If the Approved Location has not been selected and approved when the Franchise Agreement or Extreme Art Rider is signed, Attachment B or the Rider will describe the location in general terms. Once a location is approved, Attachment B-1 or the then-current form of Attachment E-1 will specify the address, automatically making it the Approved Location. While Extreme Art Studio may offer assistance, the franchisee is solely responsible for selecting each Approved Location and negotiating the lease or purchase terms. The franchisee is not guaranteed any specific Approved Location and may not obtain their top choice. An agreement on an Approved Location must be reached within four months of signing the Franchise Agreement, or Extreme Art Studio has the option to terminate the agreement. The term of the Franchise Agreement begins on the Effective Date and lasts for ten years, unless terminated earlier as provided in the agreement.