What are some examples of 'good cause' for Afuri Ramen Dumpling to refuse a transfer of ownership?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
-(c) A provision that permits a franchisor to terminate a franchise prior to the expiration of its term except for good cause.
Good cause will include the failure of the franchisee to comply with any lawful provision of the Franchise Agreement and to cure the failure after being given written notice and a reasonable opportunity, which in no event need be more than 30 days, to cure the fail
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the definition of 'good cause' regarding franchise termination is specified for franchisees in Michigan. For Michigan franchisees, 'good cause' includes the failure to comply with any lawful provision of the Franchise Agreement, provided the franchisee is given written notice and a reasonable opportunity to correct the failure. This correction period need not exceed 30 days.
This stipulation means that Afuri Ramen Dumpling can terminate a franchise agreement in Michigan if the franchisee violates the agreement's terms and fails to rectify the situation within the given timeframe. This protection ensures that franchisees in Michigan are afforded due process and an opportunity to address any shortcomings before termination occurs.
For prospective Afuri Ramen Dumpling franchisees in Michigan, this provision offers a degree of security, as it prevents the franchisor from terminating the agreement without providing a chance to remedy any breaches. However, it is important to note that this specific definition of 'good cause' applies only to Michigan franchisees, and the FDD does not provide a definition of 'good cause' for franchisees outside of Michigan. Franchisees outside of Michigan should consult the franchise agreement for the definition of 'good cause' in their jurisdiction.