What are the requirements to be considered a franchisee-in-good-standing for Azal Coffee?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
our Store opens for business unless sooner terminated as provided in this Agreement.
3.2 Option.
You will have the option to remain an Azal Coffee franchisee for two (2) additional periods of five (5) years if, at the beginning of the option period, all of the following conditions are fulfilled:
- (a) You are not in default under this Agreement or any other agreement with us or our affiliates and no affiliate of yours is in default under any agreement with us or our affiliates.
- (b) Within the last thirty-six (36) months we have not sent you two (2) or more notices of default of the terms of this Agreement or of any of our specifications, standards, or operating procedures (whether or not the notices related to the same or different violations and whether or not you have remedied those violations).
- (c) You provide written notice of your intent to continue as a franchisee not more than twelve (12) months and not less than six (6) months before the beginning of the option period.
- (d) You are able to maintain possession of the Franchise Location or you have been able to secure and develop, in compliance with our then applicable standards used in the granting of a franchise, suitable alternative premises within your Protected Area for your Store.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, a franchisee's good standing is assessed when they seek to renew their franchise agreement. To be considered in good standing and thus eligible for renewal, several conditions must be met at the beginning of the option period.
First, the franchisee must not be in default under the current Franchise Agreement or any other agreement with Azal Coffee or its affiliates. Similarly, no affiliate of the franchisee should be in default under any agreement with Azal Coffee. Furthermore, Azal Coffee should not have sent the franchisee two or more notices of default within the 36 months leading up to the renewal, regardless of whether the defaults were remedied or related to the same or different violations.
In addition to these stipulations, the franchisee must satisfy all material reporting requirements and monetary obligations to Azal Coffee, its affiliates, suppliers, vendors, and creditors within the specified time frame for satisfaction or cure of default. The only exception to this rule is for reasonable disputes that the franchisee is attempting to resolve in good faith. The franchisee must also meet any current training requirements for new or existing franchisees. Meeting these criteria ensures that an Azal Coffee franchisee is compliant and eligible to extend their franchise term.