Does the introductory text for 7 Brew mention any termination rights?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
, we and our affiliates have the right, without any restrictions whatsoever, to (a) construct, develop, and operate, and to grant others the right to construct, develop, and operate, Traditional 7 BREW Stores physically located in the Territory (except within the Area of Protection surrounding each of your Traditional 7 BREW Stores) and (b) continue to engage, and to grant others the right to engage, in any other activities we (and our affiliates) desire within the Territory.
YOU ACKNOWLEDGE AND AGREE THAT TIME IS OF THE ESSENCE UNDER THIS RIDER, AND YOUR RIGHTS UNDER THIS RIDER ARE SUBJECT TO TERMINATION, AS PROVIDED IN THIS RIDER, IF YOU DO NOT COMPLY STRICTLY WITH THE DEVELOPMENT OBLIGATIONS PROVIDED IN THE SCHEDULE AND FAIL TO CURE SUCH NON-COMPLIANCE WITHIN NINETY (90) DAYS AFTER RECEIVING WRITTEN NOTICE FROM US. WE MAY ENFORCE THIS RIDER STRICTLY.
3. Development Obligations.
- (a) Approved Affiliates. To maintain your rights under this Rider, you (and/or Approved Affiliates) must by the deadlines specified in the Schedule construct, develop, and have open and operating within the Territory the agreed-upon minimum number of Traditional 7 BREW Stores. If your owners establish a new legal entity to operate one or more of the Traditional 7 BREW Stores to be developed pursuant to this Rider and that new legal entity's ownership is completely identical to your ownership, that legal entity automatically will be considered an "Approved Affiliate" without further action.
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to the 2025 7 Brew Franchise Disclosure Document, the introductory text does not explicitly mention termination rights. However, Item 22 within the FDD discusses termination rights related to the Development Rights Rider and the Franchise Agreement. Specifically, 7 Brew has the right to terminate the Development Rights Rider if the franchisee fails to meet development obligations or other requirements outlined in the rider, or if the First Franchise Agreement is terminated. The franchisee's rights under the Rider are subject to termination if they do not strictly comply with the development obligations in the schedule and fail to cure such non-compliance within ninety days after receiving written notice.
7 Brew may terminate the Rider if the franchisee fails to meet development obligations, fails to satisfy other obligations without a cure right, if the First Franchise Agreement is terminated by 7 Brew for cause or by the franchisee without cause, or if the franchisee fails to cure a default under the First Franchise Agreement. If the Rider is terminated due to the franchisee's failure to meet development obligations, 7 Brew will retain the Development Fee but will not seek additional damages solely for the failure to comply with the schedule.
Additionally, the Franchise Agreement itself contains termination provisions. A franchisee may terminate the agreement if 7 Brew materially breaches its obligations and fails to correct the breach within a specified timeframe. 7 Brew, on the other hand, may terminate the agreement immediately upon written notice if certain events occur, as detailed in Section 18 of the agreement. These termination rights are standard in franchise agreements, allowing both parties recourse in case of significant breaches or failures to meet obligations.