What constitutes a termination by a Browns Chicken franchisee without cause?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee is in compliance with this Agreement and Brown materially breaches this Agreement, and Brown fails to cure such breach within thirty (30) days after written notice thereof is delivered to Brown, or if such breach cannot reasonably be cured within said thirty-day period and Brown fails to undertake promptly and continue efforts to cure, Franchisee may terminate this Agreement and the Franchise, effective ten (10) days after delivery to Brown of notice of termination setting forth the reasons therefor. A termination of this Agreement and the Franchise by Franchisee, other than pursuant to and in compliance with this Paragraph A of Section 20, shall be deemed a termination by Franchisee without cause.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, a franchisee's termination of the franchise agreement is considered 'without cause' if it doesn't adhere to the specific conditions outlined in Section 20, Paragraph A of the agreement. This paragraph details the circumstances under which a franchisee can rightfully terminate the agreement due to a material breach by Browns Chicken.
Specifically, for a termination to be considered 'with cause' by the franchisee, Browns Chicken must materially breach the agreement, and the franchisee must provide written notice of this breach to Browns Chicken. Browns Chicken then has a 30-day period to cure the breach. If the breach cannot be reasonably cured within 30 days, Browns Chicken must promptly begin and continue efforts to cure it. Only if Browns Chicken fails to meet these requirements can the franchisee terminate the agreement with cause, effective 10 days after delivering a termination notice that includes the reasons for termination.
Therefore, any termination by the franchisee that does not follow this procedure, even if the franchisee believes Browns Chicken is in breach, will be deemed a termination 'without cause'. This distinction is important because it can affect the franchisee's obligations and rights upon termination, such as potential restrictions on competition or the handling of lease agreements.