Does the Baya Bar franchise agreement's Article 20 survive the expiration or termination of the agreement?

According to Baya Bar's 2024 Franchise Disclosure Document, while there is no explicit mention of an "Article 20," the franchise agreement does address the survival of obligations after termination or expiration. Specifically, any obligation of the franchisee or any principal that requires performance after the termination or expiration of the agreement is deemed to survive such termination or expiration. This means certain responsibilities and duties outlined in the agreement continue even after the franchise relationship ends.

This survival clause has significant implications for a prospective Baya Bar franchisee. It means that certain obligations, such as those related to confidentiality, non-competition, or financial responsibilities, may extend beyond the term of the franchise agreement. Franchisees need to understand which specific obligations continue and for how long, as these could impact their future business activities.

For example, the agreement states that upon termination or expiration, the franchisee must immediately cease operating the franchised business and discontinue using Baya Bar's trademarks and intellectual property. Furthermore, the franchisee is obligated to pay all sums owed to Baya Bar and its affiliates, with a lien placed on the franchisee's personal property at the franchised location until all debts are settled. These post-termination obligations are typical in franchise agreements to protect the brand and ensure a smooth transition.

In summary, while the FDD does not mention Article 20, it is important for a potential Baya Bar franchisee to carefully review the franchise agreement and related documents to fully understand which obligations survive termination or expiration. It would be prudent to seek legal counsel to clarify the scope and duration of these continuing obligations and how they might affect future business endeavors.