Can Bombs Away Franchising request third-party vendors to not sell to a franchisee in default?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.4 Right to Discontinue Supplies Upon Default. While Franchisee is in default or breach of this Agreement, Bombs Away Franchising may (i) require that Franchisee pay cash on delivery for products or services supplied by Bombs Away Franchising, (ii) stop selling or providing any products and services to Franchisee, and/or (iii) request any third-party vendors to not sell or provide products or services to Franchisee.
No such action by Bombs Away Franchising shall be a breach or constructive termination of this Agreement, change in competitive circumstances or similarly characterized, and Franchisee shall not be relieved of any obligations under this
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away Franchising has the right to request that third-party vendors not sell or provide products or services to a franchisee who is in default or breach of the Franchise Agreement. Bombs Away Franchising also has the option to require the franchisee to pay cash on delivery for products or services supplied by Bombs Away Franchising, or to stop selling or providing any products and services to the franchisee.
This provision means that if a Bombs Away franchisee fails to meet their obligations under the Franchise Agreement, Bombs Away Franchising can take action to limit the franchisee's access to necessary supplies and services. This could significantly impact the franchisee's ability to operate the business.
It is important to note that Bombs Away Franchising's actions in discontinuing supplies or requesting third-party vendors to do so will not be considered a breach or constructive termination of the agreement, nor will it relieve the franchisee of their obligations under the agreement. These rights are in addition to any other remedies available to Bombs Away Franchising. This clause highlights the potential risks for franchisees who fail to comply with the terms of the Franchise Agreement, as Bombs Away has several avenues to protect its interests and the integrity of the Bombs Away brand.