What constitutes the 'same act of default' for a Bft franchisee that would trigger termination after a cure?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
- (16) Franchisee, after curing a default pursuant to Section 15.1.B herein, commits the same act of default again within any six (6)-month period whether or not such default is cured after notice thereof is delivered to Franchisee; or
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to the 2025 Bft Franchise Disclosure Document, if a franchisee cures a default, but then commits the same default again within a six-month period, Bft can terminate the agreement. This is regardless of whether the franchisee cures the second default after receiving notice.
This provision means that Bft franchisees must be especially careful to avoid repeating any mistakes that previously led to a default. Even if the franchisee fixes the problem the second time, Bft has the right to terminate the franchise agreement. This creates a situation where a single slip-up, followed by a repeat of the same slip-up within six months, can have severe consequences, even if the franchisee is actively trying to comply with the agreement.
For a prospective Bft franchisee, this highlights the importance of understanding and adhering to all terms of the franchise agreement from the outset. It also emphasizes the need to implement systems and processes to prevent the recurrence of any issues that have previously resulted in a default notice. Franchisees should maintain detailed records of all notices received and corrective actions taken to demonstrate their commitment to compliance.