How is 'control' defined in the context of an Affiliate of Fast Fix Jewelry And Watch Repairs?
Fast_Fix_Jewelry_And_Watch_Repairs Franchise · 2025 FDDAnswer from 2025 FDD Document
The parties therefore agree as follows:
ARTICLE 1. DEFINITIONS
For the purposes of this Agreement, the following terms have the following meanings:
- 1.1. "Affiliate" means, with respect to a corporation or other business entity, any person controlling, controlled by, or under common control with that business entity. With respect to an individual, Affiliate means that individual's Family members, as well as such Family members' spouses, and the corporations or other business entities such individual and his or her family members, directly or indirectly, control. "Control" means the (a) the ownership of more than 25% of the outstanding ownership or voting interests in an entity or (b) the possession, directly or indirectly, of the power to cause the direction of management and policies of such person, whether through equity ownership, by agreement, or otherwise. "Family" means, with respect to an individual, such individual's spouse and such individual's siblings; lineal ancestors of such individual or its spouse or siblings; lineal descendants of any grandparent of such individual or its spouse or siblings; and trusts for the exclusive benefit of such individual or any of the other foregoing individuals. Family relations include those by birth, adoption, and step-relations by marriage. Halfsiblings are considered siblings;
Source: Item 22 — CONTRACTS (FDD page 37)
What This Means (2025 FDD)
According to Fast Fix Jewelry And Watch Repairs' 2025 Franchise Disclosure Document, 'control' is specifically defined in relation to the term 'Affiliate.' The definition is important because it clarifies the scope of relationships that could create conflicts of interest or other obligations for the franchisee.
For a corporation or other business entity, 'control' means either (a) owning more than 25% of the outstanding ownership or voting interests in that entity, or (b) possessing the power to direct the management and policies of that entity, whether through equity ownership, agreement, or other means. This definition extends beyond just majority ownership, capturing situations where someone has significant influence over the entity's decisions even without owning a majority stake.
For an individual, 'Affiliate' includes their family members (and their spouses) and any business entities that the individual or their family members directly or indirectly control. 'Family' is broadly defined to include spouses, siblings, ancestors, descendants of grandparents, and certain trusts. This comprehensive definition ensures that the restrictions and obligations related to Affiliates extend to those closely related to the franchisee and entities they influence, preventing potential loopholes.