Under what conditions can the Bft franchisor terminate the Franchise Agreement with cause?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
(f) A Restricted Party fails to comply with the Noncompetition Restrictions set forth in Article 6 herein;
(g) Developer or its owners make an unauthorized direct or indirect Transfer or attempted or purported Transfer; or
(h) Developer commits or suffers a default of: (i) a provision of this Agreement within six (6) months following a previous violation of the same provision, or (ii) its obligations under this Agreement on three (3) or more separate occasions within any 12-consecutive-month period, in either case regardless of whether Franchisor notifies Developer of the defaults or the defaults are subsequently cured.
(2) Termination with Cure Opportunity.
Franchisor may terminate this Agreement and all rights granted hereunder, effective immediately on delivery of written notice, if:
(a) Developer fails to obtain Franchisor's prior written approval or consent any time such approval or consent is required by this Agreement, fails to comply with any provision of this Agreement in respect of which Franchisor is not authorized, under Section 8.A(1) above, to terminate immediately, or fails to act in good faith in carrying out the terms of this Agreement and, in any case, does not correct such failure within 30 days after delivery of Franchisor's written notice of such failure; or
(b) Developer or its affiliates fail to pay when due any amount owing to Franchisor or its affiliates under this Agreement or any other agreement and does not correct such failure within 10 days after delivery of Franchisor's written notice.
B. Cross-Default.
If there are now, or hereafter shall be, any other agreements in effect between Developer or any of its affiliates and Franchisor or any of its affiliates (including, without limitation, any Franchise Agreement), a default by Developer or any of its affiliates and/or owners under the terms and conditions of this Agreement or any other such agreement, shall at the option of Franchisor, constitute a default under this Agreement and all such other agreements.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the franchisor can terminate the agreement with cause under several conditions, some with an opportunity to cure the issue and others without. Bft may terminate the agreement immediately if a Restricted Party fails to comply with noncompetition restrictions, if the Developer makes an unauthorized transfer, or if the Developer defaults on a provision of the agreement within six months of a previous violation of the same provision, or defaults on obligations three or more times within a 12-month period.
Bft offers a cure opportunity for certain defaults. The franchisor may terminate the agreement if the Developer fails to obtain prior written approval when required, fails to comply with any provision of the agreement where immediate termination is not authorized, or fails to act in good faith, and does not correct the failure within 30 days of written notice. Similarly, Bft may terminate if the Developer fails to pay amounts owed to the franchisor or its affiliates and does not correct the failure within 10 days after written notice.
Furthermore, a cross-default provision states that any default by the Developer or its affiliates under any agreement with Bft or its affiliates constitutes a default under the Franchise Agreement, at Bft's option. Understanding these termination conditions is crucial for prospective franchisees to assess the risks and obligations associated with the Bft franchise.