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Title: |
Franchise Agreement [Form] |
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Entities: |
TBC Corp.; Big O Tires, Inc.; TBC Corp. |
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Date: |
2002 |
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Size: |
Preview shows 24KB of 208KB total |
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Price: |
$79 |
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ID: |
#114644 |
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BIG O TIRES, INC.
FORM OF FRANCHISE AGREEMENT
-141-
{PAGE}
BIG O TIRES, INC.
FRANCHISE AGREEMENT
TABLE OF CONTENTS
{TABLE}
{S} {C} {C}
SUMMARY PAGES............................................................... v
1. CERTAIN DEFINITIONS................................................ 1
2. GRANT OF FRANCHISE................................................. 5
2.01 Grant of Franchise...................................... 5
2.02 Trade Area.............................................. 5
3. FIRST OPTION RIGHTS................................................ 5
3.01 First Option Rights..................................... 5
3.02 Notification by Big O................................... 5
3.03 Multiple First Option Rights............................ 5
3.04 Notification of Qualification........................... 6
3.05 Exercise of Option by Franchisee........................ 6
3.06 Transfer of First Option Rights......................... 6
3.07 Limitation on First Option Rights....................... 6
3.08 Expiration of First Option Rights....................... 6
4. TERM ........................................................ 6
4.01 Term.................................................... 6
5. RENEWAL: EXTENSION OF FRANCHISE RIGHTS............................. 6
5.01 Grant of Successor Franchise Rights..................... 6
5.02 Conditions to Grant of Successor Franchise.............. 6
5.03 Notification of Non-Renewal............................. 7
6. FRANCHISEE'S DEVELOPMENT OBLIGATIONS............................... 7
6.01 Financing Approval...................................... 7
6.02 Site Selection.......................................... 7
6.03 Equipment and Signage................................... 8
6.04 Conditions to Opening................................... 8
6.05 Commencement of Business................................ 8
7. PRE-OPENING AND ONGOING ASSISTANCE................................. 8
7.01 Pre-Opening Assistance.................................. 8
7.02 On-Going Assistance..................................... 9
8. FEES ........................................................ 10
8.01 Initial Franchise Fee................................... 10
8.02 Royalty Fee............................................. 10
8.03 National Advertising Fee................................ 10
8.04 Late Fees............................................... 10
8.05 Taxes................................................... 10
8.06 Allocation of Payments.................................. 10
9. LICENSED MARKS..................................................... 11
9.01 Licensed Marks.......................................... 11
9.02 Limitations on Use...................................... 11
9.03 Infringement............................................ 11
9.04 Franchisee's Business Name.............................. 11
9.05 Change of Licensed Marks................................ 11
9.06 Franchisor's Rights..................................... 11
{/TABLE}
Page i
-142-
{PAGE}
{TABLE}
{S} {C} {C}
10. STANDARDS OF OPERATION............................................. 12
10.01 Standards of Operations................................. 12
11. STORE MANAGEMENT................................................... 13
11.01 Store Management........................................ 13
11.02 Completion of Training by Operator or Manager........... 13
11.03 Operation of Store by Big O............................. 13
12. QUALITY CONTROL.................................................... 13
12.01 Inspections............................................. 13
13. MANUAL; NEW PROCESSES.............................................. 14
13.01 Manual.................................................. 14
13.02 Confidentiality of Information.......................... 14
13.03 Revisions to Manual..................................... 14
13.04 Improvements to System.................................. 14
14. PRODUCTS AND SERVICES ............................................. 14
14.01 Products and Services................................... 14
14.02 Approval of Products and Services....................... 15
14.03 Inventory............................................... 15
14.04 Warranties and Guaranties............................... 15
14.05 Open Account Financing.................................. 16
15. ADVERTISING, MARKETING AND PROMOTIONAL PLANS....................... 16
15.01 Initial Advertising..................................... 16
15.02 National Advertising Program............................ 16
15.03 Local Fund.............................................. 17
15.04 Approval of Advertising................................. 18
16. STATEMENTS AND RECORDS............................................. 18
16.01 Invoices................................................ 18
16.02 Audit................................................... 18
16.03 Monthly Reports......................................... 18
16.04 Financial Statements.................................... 18
16.05 Management Systems...................................... 19
16.06 Retail Accounting Center................................ 19
17. COVENANTS.......................................................... 19
17.01 Noncompetition During Term.............................. 19
17.02 Confidentiality......................................... 19
17.03 No Interference with Business........................... 19
17.04 Post Termination Covenant Not to Compete................ 19
17.05 Survivability of Covenants.............................. 19
17.06 Modification of Covenants............................... 20
18. TRANSFER AND ASSIGNMENT............................................ 20
18.01 Assignment by Big O..................................... 20
18.02 Right of First Refusal.................................. 20
18.03 Transfer Legend......................................... 20
18.04 Pre-Conditions to Franchisee's Assignment............... 20
18.05 Death of Franchisee..................................... 22
18.06 No Waiver............................................... 23
18.07 Excepted Transfers...................................... 23
19. DEFAULT AND TERMINATION............................................ 23
{/TABLE}
Page ii
-143-
{PAGE}
{TABLE}
{S} {C} {C}
19.01 Termination by Big O.................................... 23
19.02 Governing State Law..................................... 25
19.03 Termination by Franchisee............................... 25
19.04 Force Majeure........................................... 25
20. POST TERMINATION OBLIGATIONS....................................... 25
20.01 Post-Termination Obligations............................ 25
20.02 Right to Repurchase..................................... 26
20.03 Right of First Refusal.................................. 26
20.04 De-Identification of Assets Upon Sale................... 26
21. INSURANCE.......................................................... 27
21.01 Insurance Coverage...................................... 27
21.02 Proof of Insurance...................................... 28
21.03 Survival of Indemnification............................. 28
22. TAXES, PERMITS, AND INDEBTEDNESS................................... 28
22.01 Payment of Taxes........................................ 28
22.02 Compliance with Laws.................................... 28
22.03 Payment of Debts........................................ 28
23. INDEMNIFICATION AND INDEPENDENT CONTRACTOR STATUS.................. 28
23.01 Indemnification......................................... 28
23.02 Independent Contractor.................................. 29
24. WRITTEN APPROVALS, WAIVERS, AND AMENDMENT.......................... 29
24.01 Written Approval........................................ 29
24.02 Waiver.................................................. 29
24.03 Modification............................................ 29
25. DEALER PLANNING BOARD.............................................. 29
25.01 Dealer Planning Board................................... 29
25.02 Special Interest Issues................................. 29
25.03 Disapproval of Management Proposal...................... 30
25.04 Compliance with Modification............................ 30
26. RIGHT OF OFFSET.................................................... 30
26.01 Right of Offset......................................... 30
27. ENFORCEMENT........................................................ 30
27.01 Declaratory and Injunctive Relief....................... 30
27.02 Costs of Enforcement ................................... 30
28. NOTICES............................................................ 30
28.01 Notices................................................. 30
29. GOVERNING LAW...................................................... 31
29.01 Governing Law........................................... 31
29.02 Jurisdiction............................................ 31
{/TABLE}
Page iii
-144-
{PAGE}
{TABLE}
{S} {C} {C}
30. SEVERABILITY AND CONSTRUCTION...................................... 31
30.01 Severability............................................ 31
30.02 Counterparts............................................ 31
30.03 Construction............................................ 31
31. ACKNOWLEDGEMENTS................................................... 32
Schedule 1 - Premises and Trade Area
Schedule 2 - Ownership Verification
Schedule 3 - Guaranty
Schedule 4 - Lease Rider and Modification
Schedule 5 - Renewal Rider
Schedule 6 - Trademarks
Schedule 7 - Converter Rider
Schedule 8 - Farm Class Rider
{/TABLE}
Page iv
-145-
{PAGE}
BIG O TIRES, INC. FRANCHISE AGREEMENT
SUMMARY PAGES
These pages summarize the attached Franchise Agreement, the details of which
shall control in the event of any conflict.
{TABLE}
{S} {C} {C}
1. FRANCHISEE:
-----------------------------------------------
2. INITIAL FRANCHISE FEE: Amount Due:
-with Application:
-----------------------------
-upon signing Agreement:
-----------------------
Total:
-----------------------------------------
3. ROYALTY FEE Two percent (2%) of Gross Sales
4. LOCAL ADVERTISING Minimum of four percent (4%) of Gross Sales
CONTRIBUTION:
5. NATIONAL ADVERTISING See SECTIONS 15 AND 25
CONTRIBUTION:
6. INITIAL ADVERTISING REQUIREMENT:
-----------------------------------------------
7. STORE LOCATION:
Street and Number
-----------------------------------------------
City, State and Zip Code
-----------------------------------------------
Phone Number
-----------------------------------------------
8. Franchisee's Operator:
-----------------------------------------------
9. Franchisee's Manager:
-----------------------------------------------
10. Franchisee's Agent for Service of Process:
Name:
-----------------------------------------------
Address:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
11. Big O's Agent for Service of Process:
Name: CT Corporation
-----------------------------------------------
Address: 1675 Broadway, Suite 1200
-----------------------------------------------
Denver, Colorado 80290
-----------------------------------------------
{/TABLE}
Page v
-146-
{PAGE}
{TABLE}
{S} {C} {C}
12. Effective Date:
-----------------------------------------------
13. Commencement Date:
-----------------------------------------------
14. Expiration Date:
-----------------------------------------------
15. Franchisee's Advisor:
-----------------------------------------------
16. Send Notices to Big O to:
Name: General Counsel
-----------------------------------------------
Address: Big O Tires, Inc.
-----------------------------------------------
12650 E. Briarwood Avenue, Suite 2-D
-----------------------------------------------
Englewood, Colorado 80112
-----------------------------------------------
17. Send Notices to Franchisee to the Store at:
Name:
-----------------------------------------------
Address:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
With a copy to:
Name:
-----------------------------------------------
Address:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
18. Business not subject to SECTION 17.01
Name:
-----------------------------------------------
Address:
-----------------------------------------------
19. Farm Class Franchise:
Yes:
----------------
No:
----------------
{/TABLE}
Page vi
-147-
{PAGE}
BIG O TIRES, INC.
FRANCHISE AGREEMENT
This Franchise Agreement ("Agreement") is made by and between Big O
Tires, Inc. ("Big O"), a Nevada corporation, with its principal place of
business at 12650 E. Briarwood Avenue, Suite 2-D, Englewood, Colorado
80112, and _______________________________________________ ("Franchisee"),
a(n) __________________ with a place of business at ___________________________
____________________, with reference to the following facts.
RECITALS
A. Big O has developed and provides franchisees with access to Products
and Services and a System for marketing and servicing such Products and Services
to retail customers through Big O Stores. Since its inception, Big O has added
to the Product and Services and System to enhance the competitive posture of its
franchisees. Big O has developed and owns certain Licensed Marks which are
licensed to franchisees for use in the Big O Stores.
B. Franchisee desires, upon the terms and conditions set forth herein,
to obtain a license to operate a Franchised Business and to offer and sell Big O
Products and Services. Franchisee acknowledges that it is essential to the
preservation of the integrity of the Licensed Marks, and the goodwill of Big O
and the Big O System, that Franchisee maintain and adhere to certain standards,
procedures and policies described hereinafter and in the Manual.
C. Big O is willing, upon the terms and conditions set forth herein, to
license Franchisee to operate a Franchised Business which will utilize the
Licensed Marks and the Big O System.
NOW THEREFORE, in consideration of the promises and the mutual
provisions herein contained and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. CERTAIN DEFINITIONS
Some words will from time to time be defined in other Sections of this
Agreement. However, the following capitalized words shall have the following
meanings when used in this Agreement:
Advertising - All advertising, promotional materials and programs, public
relations programs and marketing programs, publications and activities approved
or administered by Big O, by Franchisee, or utilizing the resources of the
National Advertising Program or local franchisee cooperatives or franchisee
associations or which pertain to the Big O Store or the Big O System generally.
Affiliate - Includes each Entity, which directly, or indirectly, through one or
more intermediaries, controls, is controlled by, or is under common control with
Big O or Franchisee, as applicable. Without limiting the foregoing, the term
"Affiliate" when used herein in connection with Franchisee includes any Entity
more than fifty percent (50%) of whose Equity or voting control, is held by
person(s) or Entities who, jointly, or severally, hold more than fifty percent
(50%) of the Equity or voting control of Franchisee.
Agreement - This Agreement, the Summary Pages and all Riders and Schedules
hereto.
Big O - Big O Tires, Inc.
Big O Brand Tires - Tires carrying the "Big O" label, as well as the Prestige,
Pathmax and Fulda brands and any other brand(s) Big O subsequently includes in
its Big O Brand Tires as part of its marketing programs.
Big O Store or Store - A retail store operated under the Licensed Marks and
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