What constitutes a 'Notice to Cure' from Afuri Ramen Dumpling?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
- 6.3.1 Default with Opportunity to Cure. You agree that it will be a default constituting a substantial breach of a material provision of this Agreement pursuant to relevant law, thus establishing good cause for termination of this Agreement and any other franchise and related agreements between the parties if you (or your owners, officers, or key employees) breach any term or provision of this Agreement and do not cure the breach (or reasonably begin to cure and diligently pursue the cure until the breach is remedied) within 30 days after receipt of our written "Notice to Cure." Termination will occur immediately upon delivery to you of our written declaration of termination for failure to cure within the allowed time frame.
- 6.3.2 Termination Without Opportunity to Cure. You agree that it will be a default constituting a substantial breach of a material provision of this Agreement pursuant to relevant law, thus establishing good cause for us to immediately terminate this Agreement and any other franchise and related agreements between the parties without other cause, and without giving you an opportunity to cure, if you (or your owners, officers, or key employees):
- A. Become insolvent, make a general assignment for the benefit of creditors, have a receiver appointed to administer or take possession of any part of the franchise or your assets, or admit to not being able to meet your obligations as they become due or become bankrupt, or become subject to any chapter of the United States Bankruptcy Code, unless you:
- (1) timely undertake to reaffirm the obligations under this Agreement;
- (2) timely comply with all conditions as legally may be imposed by us upon such an undertaking to reaffirm this Agreement; and
- (3) timely comply with such other conditions and provide such assurances as may be required in relevant provisions of the United States Bankruptcy Code;
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, a 'Notice to Cure' is a written notification from the franchisor to the franchisee regarding a breach of the franchise agreement. If the franchisee fails to correct the breach, or at least begin to correct the breach and diligently work towards a resolution, within 30 days of receiving the notice, Afuri Ramen Dumpling has grounds to terminate the agreement. The termination will take effect immediately after Afuri Ramen Dumpling delivers a written declaration of termination to the franchisee.
This clause is a standard inclusion in franchise agreements, designed to give franchisees an opportunity to rectify any failures in compliance before the franchisor takes the drastic step of terminating the agreement. The franchisee must take the notice seriously and act promptly to address the issues raised within the specified timeframe. Failure to do so can lead to the loss of the franchise.
However, Afuri Ramen Dumpling can terminate the franchise agreement without providing an opportunity to cure under specific circumstances. These circumstances include insolvency, making an assignment for the benefit of creditors, having a receiver appointed, admitting inability to meet obligations, or becoming bankrupt. These situations are considered substantial breaches that allow for immediate termination to protect the Afuri Ramen Dumpling brand and system.