Under what circumstances will a term or condition be severed from the Bang Cookies franchise agreement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Amendments to the Bang Cookies Franchise Disclosure Document
-
- THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU.
- A. A prohibition of your right to join an association of Franchisees.
- B. A requirement that you assent to a release, assignment, novation, waiver or estoppel that deprives you of rights and protections provided in this act. This shall not preclude you, after entering into a Franchise Agreement, from settling any and all claims.
- C. A provision that permits us to terminate a franchise before the expiration of this term except for good cause. Good cause shall include your failure to comply with any lawful provision of the Franchise Agreement and to cure the failure after being given written notice of the failure and a reasonable opportunity, which in no event need be more than 30 days, to cure the failure.
- D. A provision that permits us to refuse to renew a franchise without fairly compensating you by repurchase or other means for the fair market value at the time of expiration of your inventory, supplies, equipment, fixtures and furnishings. Personalized materials that have no value to us and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct of the franchise business are not subject to compensation. This subsection applies only if: (a) the term of the franchise is less than five years, and (b) you are prohibited by the Franchise Agreement or other agreement from continuing
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies' 2024 Franchise Disclosure Document, certain provisions within the franchise agreement may be deemed void and unenforceable under specific circumstances, particularly in Michigan. This is to protect the franchisee from unfair terms that the franchisor might include.
Specifically, if the Bang Cookies franchise documents contain provisions that: (A) prohibit the franchisee's right to join a franchisee association, (B) require the franchisee to waive rights and protections under the franchise act through releases or similar means (though settling claims after entering the agreement is permitted), (C) allow Bang Cookies to terminate the franchise before its expiration without good cause (where 'good cause' necessitates a failure to comply with the agreement and a reasonable opportunity to cure, not exceeding 30 days), or (D) permit Bang Cookies to refuse renewal without fairly compensating the franchisee for the fair market value of inventory, supplies, equipment, fixtures, and furnishings (excluding personalized materials or items not reasonably required for the business), then these provisions are void and unenforceable in Michigan.
This protection applies if the franchise term is less than five years and the franchisee is prohibited from continuing the business after the term. This amendment ensures that franchisees in Michigan are not subjected to unduly restrictive or unfair terms within their franchise agreements, providing a safeguard against potentially overreaching franchisor control.