9.4 (390)- Final Project: Establish Statutory Agreements Required to Operate a Franchise Business
Please see attached for instructions. This is a continuation of previous weeks' assignments. Thank you!
3 years ago 10
9.4Instructions.docx
PartialFDDInformation.pdf
9.4Instructions.docx
9.4- Final Project: Establish Statutory Agreements Required to Operate a Franchise Business
Complying with Federal Regulations for Franchises
You have operated one of your property sites as a prototype for the franchise operation. The properties are all in upscale locations that support the restaurant's thematic dessert profile.
This new site has test-marketed the franchise concept with the patented dessert brand, "Brain Freeze," that savory specialty formulated dessert treat created by Sally.
The dessert has become so popular that many customers have requested extra take-home orders. A substantial number of patrons have even asked if the dessert would ever be sold separately in markets. The dessert menu has a strong sales position in overall restaurant sales and generated a cash flow that supported the entire overhead of the test model.
Your company is now ready to launch the franchise operation, but you must first complete this assignment.
Assignment Details
This assignment is a blue font exercise; make sure you complete the document using a readable Blue Font.
Assemble the documents required to establish a national franchise operation. Review the Partial FDD Information (PDF) Download Partial FDD Information (PDF)that outlines the partial franchise requirements that legally permit your company to sell and enter into franchise agreements with franchisees. This document outlines your franchise profile. Compare the Partial Franchise Disclosure Document information using the statutory specifications found in Part 436 - Disclosure Requirements and Prohibitions Concerning Franchising (Electronic Code of Federal Regulations).Links to an external site. Specifically, look at:
· Subpart B—Franchisors' Obligations
· Subpart C—Contents of a Disclosure Document
Ensure all statutory requirements are in the PFDD document any missing sections highlighting any deficiencies or variations from the Statute.
Next, complete and revise the following agreement: FDD Franchise Agreement (DOCX). Download FDD Franchise Agreement (DOCX).
Complete all blanks "___" or bracketed "[ ]" sections with the appropriate information using Blue Font and provide any other missing terms required to solicit prospective franchisees. Make sure the agreement terms are consistent with the statutory requirements. Use your responses to questions in the Franchise Agreement Checklist completed in Assignment 9.3 to assist in completing 9.4.
This assignment requires you to demonstrate your understanding and ability to redraft an agreement and compliance with the legal provisions that meet your company's franchise requirements and comply with the statutory franchise legal requirements. You are permitted to create "best judgment" responses using the Case Study as support for information not directly provided.
Submission Instructions
Upload the following document:
Revised Franchise Agreement
PartialFDDInformation.pdf
Partial FDD Information:
Franchise Description: American Brain Freeze Dessert Corporation (ABFD), the
Franchisor, offers a single unit and multiple unit franchises for the operation of Brain
Freeze Dessert restaurants at authorized locations. An ABFD restaurant is a quick-
service food takeout restaurant with seating from which franchisees will sell the full line
of approved Dessert and beverage menu items.
Training Overview: There are currently four required components to initial Training:
1. The Management Operation Protocols Training (MOPT)
2. 3STAR SERVSAFE – certification
3. ABFD’s training program (three phases): Phase 1, Product and Equipment
Training; Phase 2, Systems & Management Training; Phase 3, People, 3STAR,
and “MO-MONEY” bottom-line Training.
4. A “Dessert Prep&dec” and certification course
The franchise’s designated manager and two assistant managers are required
attendees for the first three components. Only the Chef is required to attend the
Dessert Prep&dec certification course. Before attending the Franchisor’s training
program, the required attendees must pass the MOPT, which administered at a location
designated by the Franchisor. The MOPT measures leadership, customer service,
decision-making, prioritizing, and business math, which may be modified by the
Franchisor at any time. The required attendees must also have current 3STAR
certification, which will only be recognized by the Franchisor if received through a
course that is part of or equivalent to the National Restaurant Association’s 3STAR-
SERVSAFE program. Before the opening of the restaurant, at least one of the
restaurant employees must become a “Dessert Prep&dec” by attending and
completing a Dessert preparation certification course. The franchise’s controlling owner
(as defined in the franchise agreement) must, at the Franchisee’s expense, attend all
meetings the Franchisor holds or sponsors in their area or region including all DMA or
other marketing area meetings, and all meetings relating to new products or product
preparation procedures, new ABFD system programs, new operational procedures or
programs, Training, restaurant management, financial management, sales or sales
promotion, or similar topics.
Territory Granted: Where a franchisee enters into a franchise agreement and
Franchisor has granted and consented in writing, the Franchisee is permitted to operate
a Store at that authorized location. Under the Agreement, there is no grant to
Franchisees of any minimum area of territory. The Franchisor does not grant exclusive
territories to any franchisee under the terms of a franchise agreement.
Obligations and Restrictions: Franchisees are required to operate their ABFD
location under their active and continuous supervision. If the Franchisee is a business
entity, the Franchisee is required to have one owner who is responsible for overseeing
the general management of the day-to-day operations of the location. The Franchisor
requires franchisees to offer and sell only those goods and services that it has
approved. Also, franchisees may offer and sell these approved goods and services only
from their restaurant. Franchisees must carry the required menu items that the
Franchisor designates for their business.
Term of Agreement and Renewal: The length of the initial franchise term is ten years.
Renewal is for one additional Term for the shorter of 10 years or the remaining Term of
the lease, where Franchisee meets all requirements.
Financial Assistance: The Franchisor and its affiliates do not offer financing
arrangements or similar assistance to franchisees. The Franchisor periodically arranges
with third-party finance companies or banks to make financing programs available to
franchisees. These arrangements ordinarily involve no more than arranging to put
franchisees in contact with sources of financing available. There is no assurance that
financing will be available in any particular instance. The Franchisor nor any of its
affiliates receive any payments in exchange for referrals or the placement of any
funding.
9.4Instructions.docx
9.4- Final Project: Establish Statutory Agreements Required to Operate a Franchise Business
Complying with Federal Regulations for Franchises
You have operated one of your property sites as a prototype for the franchise operation. The properties are all in upscale locations that support the restaurant's thematic dessert profile.
This new site has test-marketed the franchise concept with the patented dessert brand, "Brain Freeze," that savory specialty formulated dessert treat created by Sally.
The dessert has become so popular that many customers have requested extra take-home orders. A substantial number of patrons have even asked if the dessert would ever be sold separately in markets. The dessert menu has a strong sales position in overall restaurant sales and generated a cash flow that supported the entire overhead of the test model.
Your company is now ready to launch the franchise operation, but you must first complete this assignment.
Assignment Details
This assignment is a blue font exercise; make sure you complete the document using a readable Blue Font.
Assemble the documents required to establish a national franchise operation. Review the Partial FDD Information (PDF) Download Partial FDD Information (PDF)that outlines the partial franchise requirements that legally permit your company to sell and enter into franchise agreements with franchisees. This document outlines your franchise profile. Compare the Partial Franchise Disclosure Document information using the statutory specifications found in Part 436 - Disclosure Requirements and Prohibitions Concerning Franchising (Electronic Code of Federal Regulations).Links to an external site. Specifically, look at:
· Subpart B—Franchisors' Obligations
· Subpart C—Contents of a Disclosure Document
Ensure all statutory requirements are in the PFDD document any missing sections highlighting any deficiencies or variations from the Statute.
Next, complete and revise the following agreement: FDD Franchise Agreement (DOCX). Download FDD Franchise Agreement (DOCX).
Complete all blanks "___" or bracketed "[ ]" sections with the appropriate information using Blue Font and provide any other missing terms required to solicit prospective franchisees. Make sure the agreement terms are consistent with the statutory requirements. Use your responses to questions in the Franchise Agreement Checklist completed in Assignment 9.3 to assist in completing 9.4.
This assignment requires you to demonstrate your understanding and ability to redraft an agreement and compliance with the legal provisions that meet your company's franchise requirements and comply with the statutory franchise legal requirements. You are permitted to create "best judgment" responses using the Case Study as support for information not directly provided.
Submission Instructions
Upload the following document:
Revised Franchise Agreement
PartialFDDInformation.pdf
Partial FDD Information:
Franchise Description: American Brain Freeze Dessert Corporation (ABFD), the
Franchisor, offers a single unit and multiple unit franchises for the operation of Brain
Freeze Dessert restaurants at authorized locations. An ABFD restaurant is a quick-
service food takeout restaurant with seating from which franchisees will sell the full line
of approved Dessert and beverage menu items.
Training Overview: There are currently four required components to initial Training:
1. The Management Operation Protocols Training (MOPT)
2. 3STAR SERVSAFE – certification
3. ABFD’s training program (three phases): Phase 1, Product and Equipment
Training; Phase 2, Systems & Management Training; Phase 3, People, 3STAR,
and “MO-MONEY” bottom-line Training.
4. A “Dessert Prep&dec” and certification course
The franchise’s designated manager and two assistant managers are required
attendees for the first three components. Only the Chef is required to attend the
Dessert Prep&dec certification course. Before attending the Franchisor’s training
program, the required attendees must pass the MOPT, which administered at a location
designated by the Franchisor. The MOPT measures leadership, customer service,
decision-making, prioritizing, and business math, which may be modified by the
Franchisor at any time. The required attendees must also have current 3STAR
certification, which will only be recognized by the Franchisor if received through a
course that is part of or equivalent to the National Restaurant Association’s 3STAR-
SERVSAFE program. Before the opening of the restaurant, at least one of the
restaurant employees must become a “Dessert Prep&dec” by attending and
completing a Dessert preparation certification course. The franchise’s controlling owner
(as defined in the franchise agreement) must, at the Franchisee’s expense, attend all
meetings the Franchisor holds or sponsors in their area or region including all DMA or
other marketing area meetings, and all meetings relating to new products or product
preparation procedures, new ABFD system programs, new operational procedures or
programs, Training, restaurant management, financial management, sales or sales
promotion, or similar topics.
Territory Granted: Where a franchisee enters into a franchise agreement and
Franchisor has granted and consented in writing, the Franchisee is permitted to operate
a Store at that authorized location. Under the Agreement, there is no grant to
Franchisees of any minimum area of territory. The Franchisor does not grant exclusive
territories to any franchisee under the terms of a franchise agreement.
Obligations and Restrictions: Franchisees are required to operate their ABFD
location under their active and continuous supervision. If the Franchisee is a business
entity, the Franchisee is required to have one owner who is responsible for overseeing
the general management of the day-to-day operations of the location. The Franchisor
requires franchisees to offer and sell only those goods and services that it has
approved. Also, franchisees may offer and sell these approved goods and services only
from their restaurant. Franchisees must carry the required menu items that the
Franchisor designates for their business.
Term of Agreement and Renewal: The length of the initial franchise term is ten years.
Renewal is for one additional Term for the shorter of 10 years or the remaining Term of
the lease, where Franchisee meets all requirements.
Financial Assistance: The Franchisor and its affiliates do not offer financing
arrangements or similar assistance to franchisees. The Franchisor periodically arranges
with third-party finance companies or banks to make financing programs available to
franchisees. These arrangements ordinarily involve no more than arranging to put
franchisees in contact with sources of financing available. There is no assurance that
financing will be available in any particular instance. The Franchisor nor any of its
affiliates receive any payments in exchange for referrals or the placement of any
funding.
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