What happens if a levy or execution is made against the Bombs Away Business?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- (c) Without Cure Period. Bombs Away Franchising may terminate this Agreement by giving notice to Franchisee, without opportunity to cure, if any of the following occur:
- (iii) a receiver or trustee for the Business or all or substantially all of Franchisee's property is appointed by any court, or Franchisee makes a general assignment for the benefit of Franchisee's creditors, or Franchisee is unable to pay its debts as they become due, or a levy or execution is made against the Business, or an attachment or lien remains on the Business for 30 days unless the attachment or lien is being duly contested in good faith by Franchisee, or a petition in bankruptcy is filed by Franchisee, or such a petition is filed against or consented to by Franchisee and the petition is not dismissed within 45 days, or Franchisee is adjudicated as bankrupt;
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to the 2024 Bombs Away Franchise Disclosure Document, if a levy or execution is made against the Bombs Away business, Bombs Away Franchising has the right to terminate the franchise agreement without providing an opportunity for the franchisee to cure the issue. This means that Bombs Away can immediately end the agreement if a legal seizure or enforcement action occurs against the business.
This provision protects Bombs Away from potential damage to its brand and reputation that could arise from a franchisee's financial instability or legal troubles. It also allows Bombs Away to quickly regain control of the franchise and find a new operator.
For a prospective franchisee, this clause highlights the importance of maintaining sound financial management and complying with all legal requirements. Failure to do so could result in the immediate termination of the franchise agreement and the loss of their investment. Franchisees should ensure they have adequate legal and financial advice to avoid such situations. This is a stricter standard than many franchise agreements, which allow a cure period for financial issues.