What happens if a receiver is appointed for a Big Air Trampoline Park franchisee?
Big_Air_Trampoline_Park Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) Franchisee becomes insolvent or is adjudicated a bankrupt; or any action is taken by Franchisee, or by others against Franchisee under any insolvency, bankruptcy or reorganization act, or if Franchisee makes an assignment for the benefit of creditors, or a receiver is appointed for Franchisee;
Source: Item 23 — RECEIPT (FDD pages 53–255)
What This Means (2025 FDD)
According to Big Air Trampoline Park's 2025 Franchise Disclosure Document, if a receiver is appointed for a franchisee, it constitutes an event of default. This gives Big Air Trampoline Park the option to either suspend its services to the franchisee while they are in default or terminate the Franchise Agreement. The termination is effective upon the franchisee's receipt of notice, subject to applicable state laws governing franchise termination and renewal.
This clause protects Big Air Trampoline Park by allowing them to take action if a franchisee's business is failing or being mismanaged to the point where a receiver is appointed. The appointment of a receiver typically indicates severe financial distress or legal issues, which could negatively impact the Big Air Trampoline Park brand. By having the option to suspend services or terminate the agreement, Big Air Trampoline Park can mitigate potential damage to its reputation and protect its interests.
For a prospective franchisee, this means that maintaining financial stability and adhering to the terms of the Franchise Agreement is crucial. The appointment of a receiver is a serious event that can lead to the loss of the franchise. Franchisees should ensure they have adequate financial resources and business management skills to avoid such a situation. It is also important to understand the conditions under which a receiver might be appointed and to seek legal and financial advice if facing financial difficulties.