Can Batteries Plus Bulbs terminate the Franchise Agreement without cause?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
ould read these provisions in the agreements attached to this disclosure document.**
| Provision | Section in Agreement(1) | Summary(1) |
|---|---|---|
| a. Length of the franchise term | Section 3; Section 3 of Multiple Unit Franchise Agreement | Franchise Agreement: 10 years. Multiple Unit Franchise Agreement: Ends on last day of Development Schedule. |
| b. Renewal or extension | Section 3 | If you are in good standing, you can renew the Franchise |
| of the term | Agreement for one additional 10 year term. | |
| c. Requirements for you to renew or extend | Section 3 | Provide advance notice, comply with current Franchise Agreement, you and your Store Manager satisfactorily complete any new/refresher training programs, you and your Principal Owners must meet current managerial, financial and business standards, sign new agreement (which may contain materially different terms and conditions than your original Franchise Agreement), remodel, pay renewal fee and Omni-Channel access renewal fee, and sign a general release of claims. |
| d. Termination by you | Section 17 | If you comply with the Franchise Agreement, and we fail to cure a material provision within 60 days after written notice. |
| e. Termination by us | Not Applicable | |
| without cause | ||
| f. Termination by us with cause | Section 16; Section 13 of Multiple Unit Franchise Agreement | We may terminate the Franchise Agreement and Multiple Unit Franchise Agreement only if you default. |
| Provision | Section in Agreement(1) Summary(1) | |
| g. “Cause” defined – curable defaults | Sections 16(B) and (C); Section 13(A) of Multiple Unit Franchise Agreement Franchise Agreement: You have 30 days to cure failure to open Store when required, failure to complete training, failure to comply with System standards, fail to renew or maintain Store lease, breach under another Batteries Plus franchise agreement, and a violation of any material provision of the Agreement. You have 10 days to cure a failure to pay amounts due us or any creditors. Multiple Unit Franchise Agreement: You have 30 days to cure failure to meet development requirements, failure to comply with this Agreement or the Franchise Agreement or you terminate a franchise Agreement without cause, and failure to comply with any requirements in the Operations Manual. You have 10 days to cure a failure to pay amounts due us or any creditors. | |
| h. “Cause” defined – non- curable defaults | Sections 16(B) and (C); Section 13(B) of Multiple Unit Franchise Agreement Franchise Agreement: Failure on 3 or more occasions in any 12 months to comply with any provision, default which is not curable, repeatedly deceive Store customers, conviction of or proof that you have committed a felony or other crime which harms the Store’s reputation, insolvency, an assignment of assets to creditors, Store abandonment, defaults which injures the goodwill associated with the Licensed Marks, use of unapproved website or other unauthorized conduct on the internet, unauthorized assignment of agreement or interest, and intentionally falsify any information provided to us. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 49–53)
What This Means (2025 FDD)
According to the 2025 Batteries Plus Bulbs Franchise Disclosure Document, Batteries Plus Bulbs cannot terminate the Franchise Agreement without cause. The table in Item 17 outlines the conditions under which Batteries Plus Bulbs can terminate the agreement, specifying that termination can only occur if the franchisee defaults. This is further detailed in sections defining both curable and non-curable defaults, which provide franchisees with opportunities to correct certain breaches of the agreement.
For a prospective Batteries Plus Bulbs franchisee, this means that the franchise agreement provides some security against arbitrary termination. Batteries Plus Bulbs must have a valid, cause-related reason to terminate the agreement, and these reasons are explicitly defined in the franchise agreement. Furthermore, franchisees are given opportunities to cure certain defaults, providing a chance to rectify issues before termination becomes a possibility.
However, it is important for potential franchisees to carefully review the definitions of 'cause' within the agreement, particularly the sections detailing curable and non-curable defaults. Understanding these provisions is crucial, as repeated failures to comply with any provision, or engaging in conduct that is deemed a non-curable default, can lead to termination. Additionally, franchisees should be aware of the specific cure periods allowed for different types of defaults, as these timelines dictate how quickly a franchisee must act to avoid termination.
It is also important to note that addenda to the Franchise Disclosure Document for specific states, such as Virginia, may provide additional protections to franchisees regarding termination. For example, the Virginia addendum states that it is unlawful for a franchisor to cancel a franchise without reasonable cause, and that any grounds for default or termination stated in the franchise agreement that does not constitute "reasonable cause" under Virginia law may not be enforceable. Therefore, prospective franchisees should carefully review any state-specific addenda to understand their rights under local laws.