What financial conditions, such as insolvency or bankruptcy, can lead to the termination of the Apricot Lane franchise agreement?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
ation of the lease for Premises;
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- Violates the requirements of Section 20 by attempting to make an unauthorized transfer, or fails or refuses to assign the franchise or the interest in FRANCHISEE as required under Section 20.D below;
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- Understates Gross Revenues two (2) or more times during the term of this Agreement or by more than two percent (2%) on any one occasion;
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- Becomes insolvent or makes a general assignment for the benefit of creditors, or if a petition in bankruptcy is filed by FRANCHISEE or such a petition is filed against and consented to by FRANCHISEE, or if FRANCHISEE is adjudicated bankrupt, or if a bill in equity or other proceeding for the appointment of a receiver of FRANCHISEE or other custodian by FRANCHISEE, or if a receiver or other custodian (permanent or temporary) of FRANCHISEE's assets or property, or any part thereof, is appointed by any court of competent jurisdiction, or if proceedings for a composition with creditors under any state or federal law should be instituted by or against FRANCHISEE, or if a final judgment remains unsatisfied or of record for thirty (30) days or longer (unless superseded as bond is filed), or if execution is levied against the Franchised Business or assets used therein, or suit to foreclose any lien or mortgage against the Premises or equipment is instituted against FRANCHISEE and not dismissed within thirty (30)
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to the 2025 Apricot Lane Franchise Disclosure Document, several financial conditions could lead to the termination of the franchise agreement. Specifically, if the franchisee becomes insolvent or makes a general assignment for the benefit of creditors, this can trigger termination. Additionally, if a bankruptcy petition is filed by the franchisee or against the franchisee with their consent, or if the franchisee is adjudicated bankrupt, Apricot Lane has grounds for termination.
Furthermore, the appointment of a receiver or custodian for the franchisee's assets or property by a court of competent jurisdiction can also lead to termination. This includes both permanent and temporary custodians. Similarly, if proceedings for a composition with creditors are instituted by or against the franchisee under state or federal law, Apricot Lane may terminate the agreement.
Finally, if a final judgment remains unsatisfied or of record for thirty days or longer (unless superseded by a bond), or if execution is levied against the franchised business or its assets, this can result in termination. The same applies if a suit to foreclose any lien or mortgage against the premises or equipment is instituted against the franchisee and not dismissed within thirty days, or if the real or personal property of the franchisee's business is sold after levy by a sheriff, marshal, or constable. However, the document also notes that termination upon the bankruptcy of the franchisee is not enforceable under federal bankruptcy law.