What is the relationship between the Mr. Sandless franchisee and the Company regarding the 'Designated Territory'?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
ly agree as follows:
1. FRANCHISE GRANT
We hereby grant to you, and you hereby accept, a nonexclusive franchise to establish and operate one (1) Franchised Business pursuant to the terms of this Agreement. This Agreement does not give you the right to establish additional Franchised Businesses.
2. TERRITORY AND LOCATION
2.1 Designated Territory
You shall operate your Business only within the designated territory identified, or (if the parties have not agreed upon a territory at the time this Agreement is signed) to be identified, in the Data Sheet (the "Designated Territory"). The size and configuration of your Designated Territory is defined in terms of contiguous zip codes and/or by a map attached to this Agreement as Attachment 2. This Agreement grants you the right to operate the Franchised Business within the Territory only. You acknowledges that (i) the Designated Territory was mutually agreed upon by you and us, (ii) prior to the Effective Date hereof, you conducted your own due diligence with regard to potential customers and other matters relative to the operation of the Franchised Business in the Designated Territory, and (iii) our agreement to the Designated Territory is permission only, does not constitute a representation, promise, warranty, or guarantee, express or implied, by us that the Franchised Business operated therein will be profitable or otherwise successful, and cannot, and does not, create any liability for us. You may not offer or sell any products or services offered by the Business to customers located outside of the Designated Territory. However, you may offer or sell products or services to customers located outside of and adjacent to your Designated Territory if the customer is located in an area that is not serviced by another System franchisee, and you have received prior written approval from us, which approval may be granted or denied at our sole discretion.
During the term of this Agreement, so long as you are in substantial compliance with the terms and conditions of this Agreement, we will not establish or locate, or grant any third party the right to establish or locate, another Mr. Sandless Business using the System and Proprietary Marks within the Designated Territory, except as set forth in Section 2.2 below. This Agreement does not grant you any other territorial rights. Notwithstanding the foregoing, if y
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, a franchisee's business operations are confined to a 'Designated Territory,' which is defined by contiguous zip codes or a map attached to the Franchise Agreement. Mr. Sandless grants the franchisee the right to operate within this territory, with the understanding that the territory was mutually agreed upon and that the franchisee has conducted their own due diligence. Mr. Sandless makes no guarantees about the profitability or success of the business within the designated territory.
The Mr. Sandless franchisee is restricted from offering or selling products or services to customers outside of their Designated Territory, unless those customers are in an unserviced area adjacent to their territory and the franchisee obtains prior written approval from Mr. Sandless. Mr. Sandless agrees not to establish or authorize another Mr. Sandless business within the franchisee's Designated Territory, as long as the franchisee is in substantial compliance with the Franchise Agreement.
However, Mr. Sandless retains certain rights, including the right to distribute products through alternative channels such as home improvement stores or the internet, even within the franchisee's Designated Territory. The franchisee does not have rights to these alternative distribution channels or any proceeds from them. The franchisee can purchase additional territories of approximately 100,000 population each for a fee of $5,000 per territory, up to a maximum of four additional territories.