Can the arbitrator stay the termination of the Alloy Franchise Agreement?

According to Alloy's 2025 Franchise Disclosure Document, the arbitrator does not have the authority to stay the effectiveness of any pending termination of the Franchise Agreement. The arbitrator's decision is final and binding, but their powers are specifically limited.

Specifically, the arbitrator cannot (1) stay the effectiveness of any pending termination of the Agreement; (2) assess punitive or exemplary damages; or (3) make any award which extends, modifies or suspends any lawful term of this Agreement or any reasonable standard of business performance that Alloy sets. This means that if Alloy decides to terminate the franchise agreement, the arbitrator cannot prevent the termination from taking effect while the arbitration is ongoing.

This limitation on the arbitrator's power is significant for prospective franchisees. Even if a franchisee believes Alloy is wrongly terminating the agreement, the franchisee cannot rely on the arbitrator to temporarily halt the termination. The franchisee would lose the right to operate under the Alloy brand while the arbitration is underway. This could cause substantial disruption and financial harm to the franchisee's business.