What happens if a Belocal franchisee defaults under Section 5.M. of the franchise agreement?

According to Belocal's 2025 Franchise Disclosure Document, if a franchisee defaults under Section 5.M. of the franchise agreement, it constitutes a cause for termination of the agreement. Belocal may provide written notice of termination, offering a period to cure the default, unless otherwise specified.

If the default is not cured within the given cure period, the franchise agreement will terminate immediately without further notice. However, Belocal retains the right to assume management of the franchised business or appoint another party to do so, until the default is resolved and the franchisee complies with the agreement, or until Belocal decides to discontinue this "step-in right."

Upon termination, the franchisee must immediately cease operations, discontinue using Belocal's trademarks and confidential information, return all copyrighted materials, pay all outstanding amounts, and comply with non-compete covenants. Belocal can also take control of the franchisee's online presence and business listings. The franchisee is responsible for settling all debts with creditors and suppliers and covering all damages, costs, and legal fees incurred by Belocal due to the default or termination.