What is the Baya Bar franchisor's obligation regarding relocation or reconstruction approval after a casualty?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
s, obtain all licenses and permits before opening, or open the Franchised Business within the time and in the manner specified in Article 8.
- 17.2.2 falsifies any report required to be furnished Franchisor hereunder;
- 17.2.3 ceases to operate the Franchised Business for a period of five (5) days or more; provided, however, that this provision shall not apply if through no fault of Franchisee, the premises are damaged or destroyed by a casualty and Franchisee applies within thirty (30) days after such event, for Franchisor's approval to relocate or reconstruct the premises (which approval shall not be unreasonably withheld) and Franchisee diligently pursues such reconstruction or relocation.
- 17.2.4 loses for any cause whatsoever the right of possession of the real property on which the Franchised Business is located;
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, if a Baya Bar location is damaged or destroyed by a casualty through no fault of the franchisee, the franchisee must apply for the franchisor's approval to relocate or reconstruct the premises within 30 days of the event. The franchisor's approval cannot be unreasonably withheld, and the franchisee must diligently pursue the reconstruction or relocation.
Furthermore, the franchisee is required to restore the Baya Bar location to full operation within a reasonable time frame, not exceeding 120 days from the date the location became inoperable due to the casualty. However, Baya Bar may extend this 120-day period at its discretion.
Failure to apply for relocation or reconstruction approval within 30 days or to restore the location within the specified timeframe (or any extension granted by Baya Bar) could result in the termination of the franchise agreement without an opportunity to cure the default. This highlights the importance of prompt action and communication with Baya Bar in the event of a casualty affecting the franchised business.