Under what circumstances can Bft immediately terminate the franchise agreement without allowing the franchisee an opportunity to cure the default?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Immediate Termination. Franchisee shall be deemed to be in default and Franchisor may terminate this Agreement and all rights granted hereunder, without affording Franchisee any opportunity to cure the default, effective immediately upon receipt of notice by Franchisee, and such termination shall be for good cause where the grounds for termination are:
(1) Franchisee has made any material misrepresentation or omission in the Application Materials or otherwise in connection with applying for the franchise or in executing or performing under this Agreement or any other agreement between Franchisee and Franchisor or any of Franchisor's affiliates;
(2) Franchisee becomes insolvent by reason of Franchisee's inability to pay debts as they become due, or makes an assignment for the benefit of creditors or makes an admission of Franchisee's inability to pay obligations as they become due;
(3) Franchisee files a petition in bankruptcy, or an involuntary petition in bankruptcy is filed against Franchisee or a receiver is appointed for Franchisee's business, or a final judgment remains unsatisfied or of record for thirty (30) days or longer; or if Franchisee is a corporation, limited liability company or partnership, Franchisee is dissolved;
(4) Franchisee voluntarily or otherwise abandons the Studio.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Bft can immediately terminate the franchise agreement without allowing the franchisee an opportunity to cure the default under specific circumstances. These circumstances include making any material misrepresentation or omission in the Application Materials or otherwise in connection with applying for the franchise or in executing or performing under the Franchise Agreement or any other agreement between the franchisee and Bft or any of Bft's affiliates.
Additionally, Bft can immediately terminate the agreement if the franchisee becomes insolvent, makes an assignment for the benefit of creditors, or admits their inability to pay obligations. Immediate termination is also permitted if the franchisee files a petition in bankruptcy, an involuntary petition in bankruptcy is filed against them, a receiver is appointed for their business, or a final judgment remains unsatisfied for 30 days or longer. If the franchisee is a corporation, limited liability company, or partnership, its dissolution also allows for immediate termination.
Finally, Bft can immediately terminate the franchise agreement if the franchisee voluntarily or otherwise abandons the Studio. This means that franchisees need to be extremely careful in their dealings with Bft and in the operation of their business, as certain actions can lead to immediate termination of the agreement without any chance to correct the issue.