What is the consequence if a Buildingstars franchisee is convicted of a felony that materially affects the franchise?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything contained herein to the contrary, if state law permits, BUILDINGSTARS shall be permitted to terminate the franchise immediately upon notice when the basis or grounds for cancellation is: (a) FRANCHISEE or its owners are convicted of a felony or any other criminal misconduct which materially and adversely affects the operation, maintenance, reputation, or goodwill of the franchise; (b) fraudulent activity which materially and adversely affects the operation, maintenance, reputation, or goodwill of the franchise; (c) abandonment of the franchise; (d) bankruptcy or insolvency of the FRANCHISEE; (e) the giving of more than two (2) no account or insufficient funds checks within a twelve-month period; or (f) any other act or omission which permits termination without notice and/or an opportunity to cure under applicable state law.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, if a franchisee or its owners are convicted of a felony or any other criminal misconduct that materially and adversely affects the operation, maintenance, reputation, or goodwill of the franchise, Buildingstars has the right to terminate the franchise agreement immediately upon notice, provided that state law permits such action. In this case, the franchisee would not have an opportunity to cure the issue.
This means that a Buildingstars franchisee's business is at risk if they, or their owners, are convicted of a felony that reflects poorly on the franchise. The immediate termination clause underscores the importance of maintaining a clean criminal record and adhering to ethical business practices.
Prospective Buildingstars franchisees should be aware of this clause and understand the potential consequences of criminal convictions. They should also consult with an attorney to understand how state laws might affect this provision, as the ability of Buildingstars to terminate immediately depends on whether it is permitted by applicable state law.