Is the Franchisor a third-party beneficiary of the Hawaiian Bros Island Grill agreement?
Hawaiian_Bros_Island_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
As such, Landlord and Tenant acknowledge and agree that Franchisor is an intended third-party beneficiary of this Rider with an independent right, but not obligation, to enforce any and all of its terms.
Subject to Section 1 regarding amendment of the Master Agreement, Franchisee and Don agree that no amendment to this Participation Agreement will be effective without the written consent of Hawaiian Bros. Hawaiian Bros is an intended third party beneficiary of this Participation Agreement.
Source: Item 23 — RECEIPTS (FDD pages 77–262)
What This Means (2025 FDD)
According to the 2025 Hawaiian Bros Island Grill Franchise Disclosure Document, Hawaiian Bros Franchising, LLC is an intended third-party beneficiary in certain agreements. Specifically, in the Lease Rider, the franchisor has an independent right, but not the obligation, to enforce any and all of its terms. This means Hawaiian Bros Island Grill has specific rights related to the lease agreement between the franchisee and the landlord.
Additionally, in the Franchisee Participation Agreement with Edward Don & Company, Hawaiian Bros Inc. is also named as an intended third-party beneficiary. This agreement pertains to the distribution of non-food supplies. This gives Hawaiian Bros Island Grill certain rights and protections under the agreement between the franchisee and the supplier.
For a prospective franchisee, this means that Hawaiian Bros Island Grill has the ability to directly enforce certain agreements that the franchisee enters into, particularly concerning the restaurant's location and supply chain. This arrangement is not uncommon in franchising, as it allows the franchisor to maintain brand standards and operational consistency across all franchise locations. It is important for franchisees to understand the implications of these third-party beneficiary clauses, as they could be subject to obligations enforced directly by the franchisor.