Under what condition can Bor Restoration terminate a franchise agreement?
Bor_Restoration Franchise · 2024 FDDAnswer from 2024 FDD Document
ment that does not have its own cure period and is not identified in Section 10.1 and fail to cure within the 30 days.
10.3 Cross Default
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- a. If you are a party to any other Franchise Agreements with us or are a party to any agreements with an Affiliate, and if such agreement is breached and not timely cured within the period permitted in such document with the result being that that agreement is terminated, then we have the right to terminate your franchise rights without affording you any additional right to cure.
- b. If you violate the terms, covenants, or conditions of any other contract or agreement with a third party that is unrelated to us but which is material to the operation of the Business, including any real property or equipment lease (Third Party Contract) and fail to cure any such breach within the time permitted under such Third Party Contract, and as a result, you are unable, (i) to operate this Business in the manner that you were able to before the breach of the other agreement; or, (ii) to operate any other Business under a separate franchise agreement (cross-default); or, (iii) operate the Business under the terms of this Franchise Agreement, then upon termination of said Third Party Contract, this and all other franchise agreements with us may, in our sole and exclusive discretion, also be terminated at the same time as the Third Party Contract terminates.
Source: Item 16 — Restrictions on What the Franchisee May Sell (FDD page 33)
What This Means (2024 FDD)
According to Bor Restoration's 2024 Franchise Disclosure Document, there are several conditions under which they can terminate a franchise agreement. One such condition arises if the franchisee has other franchise agreements with Bor Restoration or agreements with an affiliate, and any of those agreements are breached and not cured within the allowed period, leading to termination of that agreement. In this case, Bor Restoration can terminate the franchise rights without granting any additional cure period.
Another condition for termination involves the franchisee violating the terms of any contract with a third party that is material to the operation of the Bor Restoration business, such as a real property or equipment lease. If the franchisee fails to cure the breach within the time permitted by the third-party contract, and this failure results in the franchisee being unable to operate the business as before, operate another business under a separate franchise agreement, or operate the business under the terms of the Franchise Agreement, then Bor Restoration may terminate the franchise agreement. The termination can occur simultaneously with the termination of the third-party contract, at Bor Restoration's discretion. The franchisee is required to provide immediate notice to Bor Restoration if such a material agreement is terminated.
Additionally, Bor Restoration will conduct criminal and credit background checks on franchisees, both during the application process and throughout the term of the franchise agreement. Should these checks reveal any material adverse changes in the franchisee's status, it may result in the termination of the franchise agreement. This highlights the importance of maintaining a clean criminal and credit record for the duration of the franchise term.