factual

Under what circumstances will the Bang Cookies Development Agreement automatically end?

Bang_Cookies Franchise · 2024 FDD

Answer from 2024 FDD Document

Franchisor possesses the right, at Franchisor's option, to terminate this Agreement and all rights granted to Franchisee hereunder, without affording Franchisee with any opportunity to cure such default, effective upon written notice to Franchisee, or automatically upon the occurrence of any of the following events: (a) if Franchisee Abandons Franchisee's obligations under this Agreement; (b) if Franchisee for four consecutive months, or any shorter period that indicates an intent by Franchisee to discontinue Franchisee's development of Shops within the Development Area; (c) if Franchisee becomes insolvent or is adjudicated bankrupt, or if any action is taken by Franchisee, or by others against the Franchisee, under any insolvency, bankruptcy or reorganization act, or if Franchisee makes an assignment for the benefit or creditors or a receiver is appointed by the Franchisee; (d) if Franchisee fails to meet its development obligations under the Development Schedule for any single Development Period including, but not limited to, Franchisee's failure to establish, open and/or maintain the cumulative number of Bang Cookies Shops in accordance with Development Schedule; and/or (e) in the event that any one Franchise Agreement is terminated respecting any Development Shop and/or any other Franchise Agreement between Franchisor and Franchisee.

Source: Item 23 — RECEIPTS (FDD pages 56–245)

What This Means (2024 FDD)

According to Bang Cookies's 2024 Franchise Disclosure Document, the Development Agreement can be terminated automatically by the Franchisor under specific conditions, without giving the franchisee an opportunity to correct the issue. These conditions include abandonment of obligations, which refers to conduct indicating an intent to discontinue development or operation of Bang Cookies Shops in the Development Area.

The agreement can also be terminated if the franchisee fails to develop shops for four consecutive months, or any shorter period that indicates an intent to discontinue development. Insolvency or bankruptcy of the franchisee, or actions taken by or against the franchisee under insolvency, bankruptcy, or reorganization acts, also lead to automatic termination. This includes making an assignment for the benefit of creditors or the appointment of a receiver.

Furthermore, failure to meet development obligations under the Development Schedule, such as not establishing, opening, or maintaining the required number of Bang Cookies Shops, can result in automatic termination. Finally, the termination of any single Franchise Agreement related to a Development Shop or any other Franchise Agreement between Bang Cookies and the franchisee will also cause the Development Agreement to automatically end.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.