Are there any geographic limitations specified in the Extreme Art Rider for Extreme Art Studio?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
- 1.5 TERRITORY.
Provided that you are in full compliance with the terms and conditions of this Franchise Agreement and all other agreements with us and our affiliates, we will not establish or operate, or franchise any entity to establish or operate, an Extreme Art Studio Business using the Marks and System at any location within the Territory (as defined below) of any of your Extreme Art Studio Businesses, once such Territory has been determined.
The "Territory" shall be the specific geographical area we specify for the applicable Extreme Art Studio Business and may be described in terms of contiguous zip codes, street boundaries, and county boundaries or depicted on a map included on Attachment B-1 or the applicable Extreme Art Rider. .
- 1.6 TERRITORIAL RIGHTS WE RESERVE.
Except as expressly limited by Section 1.5 above, you acknowledge and agree that we (and our affiliates) retain all rights with respect to the placement of Extreme Art Studio Businesses and other businesses using the Marks, the sale of similar or dissimilar products and services, and any other activities.
These rights include, without limitation:
1.6.1 the right to establish and operate, and allow others to establish and operate, other Extreme Art Studio Businesses and other art studio businesses and/or businesses offering On the Go Services using the Marks and the System, holding classes at any location outside the Territory of your Extreme Art Studio Businesses and on such terms and conditions we deem appropriate;
1.6.2 the right to establish and operate businesses similar to the Extreme Art Studio Business anywhere under other trade names, trademarks, service marks and commercial symbols different from the Marks;
1.6.3 the right to use the Marks and the System to sell any products or services the same as or similar to those that you will sell through any alternative channels of distribution within or outside of the Territory including retail locations and other channels of distribution such as television, mail order, catalog sales, wholesale to unrelated retail outlets, or over the Internet;
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, the Extreme Art Rider does address geographic limitations through the establishment of a territory. Once Extreme Art Studio and the franchisee mutually agree upon a territory, which must conform to the guidelines outlined in Item 12 of the FDD, Attachment E-1 will be completed to specify the territory.
The FDD states that Extreme Art Studio will not establish or operate, nor franchise any other entity to do so, an Extreme Art Studio business using their marks and system within the franchisee's territory, provided the franchisee is in full compliance with the terms and conditions of the Franchise Agreement. This territorial protection applies once the territory has been determined for any of the franchisee's Extreme Art Studio businesses. The territory itself is defined as the specific geographical area designated for the Extreme Art Studio Business, which may be described using contiguous zip codes, street boundaries, and county boundaries, or depicted on a map included on Attachment B-1 or the applicable Extreme Art Rider.
However, Extreme Art Studio retains certain rights, even with a defined territory. These include the right to establish and operate other Extreme Art Studio businesses or businesses offering "On the Go Services" outside the franchisee's territory, the right to operate similar businesses under different trade names, and the right to use the marks and system to sell products or services through alternative channels of distribution, such as online sales or wholesale, both within and outside the territory. These stipulations mean that while a franchisee is granted a specific territory, Extreme Art Studio maintains considerable flexibility in its broader business operations and expansion strategies.