Under what conditions can Black Bear Diner terminate the Area Development Agreement with cause?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
rnia-specific disclosures.**
AREA DEVELOPMENT AGREEMENT
| Provision | Section in the Area Development Agreement | Summary | |
|---|---|---|---|
| a. | Length of the term of the Area Development Agreement | Section 5 | The rights granted under the Area Development Agreement expire on the earlier to occur of the actual opening date of the last of the Black Bear Diner restaurants required to be developed pursuant to the Development Schedule or the last day of the last Development Period under the Development Schedule. |
| b. | Renewal or extension of term | Not Applicable | |
| c. | Requirements for you to renew or extend | Not Applicable | |
| d. | Termination by you | You may terminate under any grounds permitted by law. | |
| e. | Termination by us without cause | Not Applicable | |
| f. | Termination by us with cause | Section 8 | If you breach the Area Development Agreement, we will have cause to terminate. |
| g. | "Cause" defined (defaults which can be cured) | Section 8 | Except for defaults in (h) below, you generally have 30 days to cure any defaults contained in the Area Development Agreement. |
| Provision | Section in the Area Development Agreement | Summary | |
| ---- | ----------------------------------------------------------------------------------------- | ---------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| h. | "Cause" defined (defaults which cannot be cured) | Section 8.1 and 9.1 | Non-curable defaults include: bankruptcy related events, any unapproved transfers, any material misrepresentations in the application for the Development Agreement; conviction of a felony; |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 41–46)
What This Means (2025 FDD)
According to Black Bear Diner's 2025 Franchise Disclosure Document, Black Bear Diner can terminate the Area Development Agreement with cause if the franchisee breaches the agreement. Generally, the franchisee has 30 days to cure any defaults. However, there are specific defaults that cannot be cured.
Non-curable defaults include bankruptcy-related events, any unapproved transfers, material misrepresentations in the application for the Development Agreement, conviction of a felony, any unauthorized use of Black Bear Diner's Marks or Confidential Information, termination of a Franchise Agreement by Black Bear Diner for cause or by the franchisee without cause, and failure to meet the development obligations. Black Bear Diner can terminate the Development Agreement if they have delivered a notice of termination of a Franchise Agreement in accordance with its terms and conditions or the franchisee has terminated a Franchise Agreement without cause.
These termination conditions are typical in franchise agreements, as they protect the franchisor's brand and system. Prospective franchisees should carefully review the Area Development Agreement to fully understand what constitutes a breach and what steps they can take to avoid termination. Understanding both curable and non-curable defaults is crucial for maintaining a good standing with Black Bear Diner and fulfilling the obligations of the Area Development Agreement.