Is a Boulder Designs franchisee's conviction of animal abuse grounds for termination of the franchise?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in the | Summary | |
|---|---|---|---|
| Franchise Agreement | |||
| a. Length of the franchise | Section 4.1 | 10 years. | |
| term | |||
| b. Renewal or extension of | Section 4.2 | Additional 10-year term if certain conditions | |
| the term | are met. | ||
| Provision | Section in the Franchise Agreement | Summary or modify their business relationship with Us, our Affiliate(s) or any other franchisee. | |
| s. Modification of the | Sections 9.2 and | The Franchise Agreement can be modified | |
| agreement | 22.6 | only by written agreement between you and us. | |
| t. Integration/merger clause | Section 22.6 | Only the terms of the Franchise Agreement and all exhibits to the Franchise Agreement are binding (subject to state law). Any representations or promises made outside of the disclosure document and the Franchise Agreement may not be enforceable. | |
| u. Dispute resolution by arbitration or mediation | Section 23.7 | Except for actions or claims for injunctive relief or specific performance or relating to the Marks, Trade Secrets or Confidential Information, all disputes must be mediated in McLennan County, Texas. (Subject to state law) | |
| v. Choice of forum | Section 23.2 | Litigation must be initiated and maintained in the judicial district in which our principal place of business is located at the time the lawsuit was initiated, currently Waco, Texas. We have the right to seek injunctive relief from any court of competent jurisdiction. (Subject to state law) | |
| w. Choice of law | Section 23.1 | Texas law applies (subject to state law), except that disputes over the Marks will be governed by the United States Trademark Act of 1946. | |
| Section in the | |||
| Franchise | |||
| Summary | |||
| Agreement | |||
| Agreement following a default, your interest in | |||
| the franchise will terminate. | |||
| 5.4, 5.5. | |||
| We can terminate if you fail to develop the | |||
| and 16.2 | |||
| Approved Location within 180 days after the | |||
| Effective Date of the Franchise Agreement. We | |||
| also can terminate for failure to pay the Initial | |||
| Franchise Fee or other amounts due within 10 | |||
| days after receiving written notice; failure to | |||
| have your Internal Manager satisfactorily | |||
| complete any training program; attempted or | |||
| actual transfer of business in violation of the | |||
| Franchise Agreement; misuse of the Marks, or | |||
| other act which impairs the goodwill of any of | |||
| the Marks; material misrepresentation or | |||
| omission in your franchise application; are | |||
| conviction or "no contest" plea to a crime or | |||
| offense that would place them on the sex | |||
| offenders registry, was a violent felony, crimes | |||
| against a human, sexual harassment against an | |||
| employee, domestic abuse charges, animal | |||
| abuse, elderly abuse, substance abuse, DWI or | |||
| DUI, any theft charge or is likely to affect the | |||
| reputation of either party or the Franchised | |||
| Business; disclose, duplicate, or otherwise | |||
| misuse the Manual, Confidential Information | |||
| or the Marks; are adjudicated bankrupt, | |||
| insolvent or make a general assignment for the | |||
| benefit of creditors or to pay any fees due us or | |||
| any Affiliate; receive three or more default | |||
| notices within two years,(or failure on 2 or | |||
| more separate noticed occasions to comply | |||
| with the same obligation in any time-frame); | |||
| continue to violate any health, safety or other | |||
| laws or conduct the Franchised Business in a | |||
| manner creating a health or safety hazard to | |||
| customers, employees or the public; take any | |||
| action reserved to us; fail to comply with | |||
| applicable law after notice; repeatedly breach | |||
| the Franchise Agreement or fail to comply with | |||
| specifications; engaging in wholesale | |||
| transactions without our prior written consent; | |||
| or default under any other agreement between | |||
| you and us(or an Affiliate) such that we (or the | |||
| Affiliate) have the right to terminate the | |||
| agreement. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–44)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, a franchisee's conviction of animal abuse can be grounds for termination of the franchise agreement. Specifically, if a franchisee, or their internal manager, is convicted of or pleads "no contest" to animal abuse charges, Boulder Designs has the right to terminate the franchise agreement.
This provision aims to protect the reputation of Boulder Designs and its brand. The company wants to ensure that its franchisees maintain a positive public image and do not engage in activities that could harm the brand's goodwill. This is a fairly common clause in franchise agreements, as franchisors are keen to protect their brand image.
It is important to note that the termination is not automatic upon conviction. Boulder Designs has the right to terminate the agreement, but it is not obligated to do so. The decision to terminate may depend on the specific circumstances of the case and the potential impact on the Boulder Designs brand. This clause also extends to other offenses such as sex offenses, violent felonies, crimes against a human, sexual harassment against an employee, domestic abuse charges, elderly abuse, substance abuse, DWI or DUI, and any theft charge.