ALLEGRA PRINT Franchise Complaints

October 10 2013

Good Morning-

I wanted to call to your attention what we believe is at minimum a corporate over reach and could be considered by many to be unfair and an injustice action by the Allegra Network home office.

On expiration of our 20 year franchise agreement at the end of June we found out the hard way, that the non-compete clause not only applied to a contract termination but also on the contract expiration.

Following some not so good advice from our attorney, we really believed that the Minnesota Franchise Statue 2860.4400 would provide us some coverage and leverage to negotiate the location restriction of the non-compete. After all, the home office declined the option to take over our lease and we already were quite some distance from any of the other centers. An important fact is that we have 12 other network franchises in our metro market. Our center was number 13.
When you consider the conditions of the non-compete (5 mile radius from any of the other 12 and 10 miles from our center) the actual areas left in the Twin Cities Metro area where we could relocate were restrictively limited.

We had completely “de-Allegra identified “ our building in and out, website, social media etc. Our website, and emails were given to another center the day after expiration, which is all fine and things that we expected. The big problem for us is that our lease here does not expire until 8/1/15. Our landlord has no tenant to replace us and we have no sub-lease candidate. We can’t pay two rents.

We have a had a leading commercial realtor working with us since April, but the conditions of the non-compete (5 miles from any other center and 10 miles from our previous address), have left the choices very few in the under 5000 sq. ft. size and with the concrete and 200 amp – 3 ph. (electric) we need for our 4 color 20 inch press.

The home office has filed, in Michigan court, a law suit against Joan and I stating that we somehow are still using the trademark – we absolutely are not – and the non-compliance to the non-compete – in which we admit we are, but because of the situation of our property.

To defend this in Michigan is very expensive,

We have faithfully paid them and the previous Insty-Prints group nearly $1,000,000 in royalties over the 20 years and owed them nothing on expiration. Allegra purchased all the Insty Prints contracts in 2003 and we converted to an Allegra in 2005.

The home office is claiming that our continued presence in Burnsville, MN is causing irreparable damage to the Allegra network’s brand and the other franchises in the area.

In 20 years of being an Insty-Prints and an Allegra, Joan and I cannot recall one competitive conflict with another franchise over an account or proposal for new business. We have always respected the other franchises and gone out of our way to help any one of the other franchises who needed help in anyway we could be of help.

We don’t wish ill-will on anyone, not locally or the home office we are just trying to feed our families and our employee’s families.

They are determined to bankrupt us...