Under what conditions can the Obligor cancel the Big O Tires plan in Alaska?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
Alaska: CANCELLATION is deleted and replaced with the following: You may return this Plan to the selling dealer within thirty (30) days of the Plan Purchase Date, if no claim has been made under the Plan, the Plan is void and you shall receive a refund of the full price paid for the Plan. After the first thirty (30) days from the Plan Purchase Date, we or the selling dealer will refund you a pro-rated amount of the Plan Purchase Price, based on the months remaining. The Obligor may cancel this Plan for non-payment of Plan Purchase Price by the selling dealer to Obligor, or for material misrepresentation or fraud at time of sale. If Obligor cancels this Plan, Obligor or the selling dealer will refund you 100% of the Plan Purchase Price.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to the 2025 Big O Tires Franchise Disclosure Document, specific conditions apply to the cancellation of a Road Hazard Plan in Alaska.
The Obligor, which is the entity responsible for fulfilling the terms of the plan, can cancel the plan if the selling dealer has not paid the Plan Purchase Price to the Obligor. This protects the Obligor from financial loss if the dealer fails to remit the funds for the plan. The Obligor can also cancel the plan in the event of material misrepresentation or fraud at the time of sale. This provision ensures that the Obligor is not held responsible for claims arising from dishonest or inaccurate information provided during the purchase of the plan.
If Big O Tires, as the Obligor, cancels the plan under these conditions, the franchisee will receive a full refund of the Plan Purchase Price. This is designed to protect the consumer from loss if the plan is canceled due to issues not directly caused by the customer. This full refund policy applies specifically when the Obligor initiates the cancellation.
It's important to note that the franchisee also has cancellation rights. Within the first 30 days of the Plan Purchase Date, the franchisee can return the plan to the selling dealer for a full refund, provided no claims have been made. After this initial period, the franchisee can receive a pro-rated refund based on the remaining months of the plan.