What are some examples of non-curable defaults that would allow Big Apple Bagels to terminate the franchise agreement?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Provision in Franchise Agreement (unless otherwise specified) | Summary |
|---|---|---|
| a. Length of the franchise | Paragraph 2.a. | 10 years |
| term | ||
| b .Renewal or extension of | Paragraph 2.b. | If you are in good standing, you can renew on the then current terms |
| the term | ||
| c. Requirements for Franchisee to renew or extend | Paragraph 2.b. | Pay renewal fee of $2,500, maintain premises or secure substitute premises, remodel, sign new agreement and other documents and sign release, and agree to upgrade to then-current standards of decor, equipment, and product offerings. The renewal agreement may contain materially different terms and conditions than your original contract, but the royalty fee will not be greater than the royalty fee that we then impose on similarly-situated renewing franchisees |
| d. Termination by | Section 15 | Breach by BAB, you in compliance. Additionally, you may terminate |
| Franchisee | the agreement under any grounds permitted by law. | |
| e. Termination by | Not Applicable | BAB cannot terminate your Franchise Agreement without cause |
| Franchisor without cause | ||
| f. Termination by | Section 16 | BAB can terminate only if you commit any 1 of several listed |
| Franchisor with cause | violations | |
| g. "Cause" defined – curable faults | Section 16 | You have 10 days for monetary defaults and failure to maintain required insurance, and 30 days for all defaults not listed in Paragraph 16.a. |
| h. "Cause" defined – non- curable defaults | Section 16 | Failure to submit site within 90 days, failure to open Store in 4 months of possession, failure to complete initial training, abandonment, conviction of felony, unauthorized transfers, unauthorized use or disclosure of confidential information or BAGELS Operations Manual, unauthorized use of Marks, creation of a threat to public health or safety, repeated defaults (even if cured), unapproved transfer upon your death or permanent incapacity, failure to comply with covenants in Paragraph 9.f; termination of other agreement between BAB and you. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 69–75)
What This Means (2025 FDD)
According to Big Apple Bagels's 2025 Franchise Disclosure Document, there are several non-curable defaults that could lead to the termination of the franchise agreement. These are serious violations that Big Apple Bagels does not allow a franchisee to fix or correct after they occur.
Specifically, Big Apple Bagels lists the following as non-curable defaults: failure to submit a site within 90 days, failure to open the store within 4 months of taking possession of the premises, failure to complete the initial training program, abandonment of the franchise, conviction of a felony, unauthorized transfers of the franchise, unauthorized use or disclosure of confidential information or the BAGELS Operations Manual, unauthorized use of the Marks, creating a threat to public health or safety, repeated defaults (even if they were previously cured), an unapproved transfer upon the franchisee's death or permanent incapacity, failure to comply with the covenants in Paragraph 9.f, and termination of any other agreement between Big Apple Bagels and the franchisee.
These stipulations are typical in franchise agreements, as franchisors need to protect their brand standards, trade secrets, and reputation. Franchisees should pay close attention to these terms and conditions before signing the agreement, as any of these non-curable defaults could result in the immediate termination of their franchise and loss of their investment.