What obligation does a Marble Slab Creamery franchisee undertake regarding the operation of the restaurant?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
5.1 A Franchisee which is a corporation will comply, except as otherwise approved in writing by Franchisor, with the following requirements throughout the term of this Agreement:
5.1.1 Franchisee will furnish Franchisor with its Articles of Incorporation, By-laws, other governing documents, any other documents Franchisor may reasonably request, and any amendments thereto.
5.1.2 Franchisee will confine its activities exclusively to operating the Restaurant and any other "MARBLE SLAB CREAMERY" restaurants owned and operated by Franchisee pursuant to a validly existing franchise agreement.
5.1.3 Franchisee will maintain stop transfer instructions against the transfer on its records of any Equity securities; and will issue no securities upon the face of which does not legibly and conspicuously appear a printed legend in the form reasonably prescribed by Franchisor stating that the transfer of such stock is subject to the terms and conditions of this Agreement.
5.1.4 Franchisee will maintain a current list of all owners of record and all beneficial owners of any class of voting securities or securities convertible into voting securities of Franchisee and will furnish the list to Franchisor upon request.
5.2 A Franchisee which is a limited liability company will comply, except as otherwise approved in writing by Franchisor, with the following requirements throughout the term of this Agreement:
5.2.1 Franchisee will furnish Franchisor with its Articles of Organization, Certificate of Formation, Operating Agreement, Limited Liability Company Agreement, other governing documents, any other documents Franchisor may reasonably request, and any amendments thereto.
5.2.2 Franchisee will confine its activities exclusively to operating the Restaurant and any other "MARBLE SLAB CREAMERY" restaurants owned and operated by Franchisee pursuant to a validly existing franchise agreement.
5.2.3 Franchisee will maintain stop transfer instructions against the transfer on its records of any Equity securities; and will issue no securities upon the face of which does not legibly and conspicuously appear a printed legend in the form reasonably prescribed by Franchisor stating that the transfer of such stock is subject to the terms and conditions of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 101)
What This Means (2025 FDD)
According to the 2025 Marble Slab Creamery Franchise Disclosure Document, franchisees have specific obligations regarding the operation of their restaurant. Franchisees that are corporations or limited liability companies must confine their business activities exclusively to operating a Marble Slab Creamery restaurant, or other Marble Slab Creamery restaurants if they have multiple franchise agreements with the company. This means a franchisee cannot operate other types of businesses alongside the Marble Slab Creamery franchise unless they receive written approval from Marble Slab Creamery.
For corporate franchisees, they must provide Marble Slab Creamery with their Articles of Incorporation, By-laws, governing documents, and any amendments. Similarly, limited liability company franchisees must furnish their Articles of Organization, Certificate of Formation, Operating Agreement, Limited Liability Company Agreement, other governing documents, and any amendments to Marble Slab Creamery. Both types of franchisees must also maintain stop transfer instructions against the transfer of any equity securities on their records. They must also include a legend on any issued securities stating that the transfer of such stock is subject to the terms and conditions of the franchise agreement.
These requirements ensure that Marble Slab Creamery franchisees focus solely on the operation of their franchised restaurants and maintain transparency with the franchisor regarding their organizational documents and equity ownership. This allows Marble Slab Creamery to maintain brand consistency and control over its franchise system. Prospective franchisees should be aware of these obligations and ensure they can comply with them before entering into a franchise agreement.