Does the Bumper Man franchisor need to provide notice to the franchisee before terminating the agreement?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
anchisor.
(e) Severability and Enforceability of Covenants. Each of the covenants contained in this Section 17 will be considered separate and independent from each other. If any covenant in this Agreement which restricts competitive activity is deemed unenforceable for any reason, but would be enforceable by reducing or substituting any part of it in accordance with Section 26(a), such covenant will be enforced to the fullest extent permissible under Applicable Law.
18. DEFAULT AND TERMINATION.
The occurrence of any of the following will adversely and substantially affect the interests of Franchisor and will be deemed an Event of Default constituting just cause for exercising any of the remedies set forth herein:
- (a) Franchisor may terminate this Agreement upon delivery to Franchisee of Notice as a result of the occurrence of any of the following Events of Default and Franchisee's failure to cure such Event of Default within the cure period described below, if any, and absent a cure period, immediately upon Franchisor's Notice to Franchisee:
- (i) Franchisee (or any of its Principals or Affiliates) has made any material misrepresentation or omission in connection with this Agreement;
- (ii) Franchisee fails to begin operating the Bumper Business as of the Commencement Date, and fails to cure such default within 30 days after Notice of such Event of Default is delivered to Franchisee;
- (iii) Franchisee abandons or fails actively to operate the Bumper Business for
five or more Business Days unless the Bumper Business has been closed for a purpose Franchisor has approved in writing or because of an Event of Force Majeure;
- (iv) Franchisee fails to submit invoices to Franchisor for processing for seven or more consecutive Business Days without Franchisor's prior approval;
- (v) Franchisee surrenders or transfers Control of the operation of the Business without Franchisor's prior written consent;
- (vi) Franchisee (or any of its Principals or Affiliates) is or has been held liable or convicted by a court of law, pleads or has pleaded no contest to, a felony, indictable offense or other unlawful act, engages in any dishonest or unethical conduct or otherwise engages in any act or conduct which Franchisor believes will materially and adversely affect the reputation of the Bumper Business, any other Bumper Man business or the goodwill associated with Marks;
- (vii) Franchisee's misuse or unauthorized use of the Marks, including without limitation Franchisee's misuse or unauthorized use of the Marks on its Social Media pages or other Internet site, or registration of a domain name incorporating the Marks;
- (viii) Franchisee (or any of its Principals or Affiliates) makes an unauthorized Transfer pursuant to Section 16;
- (ix) Franchisee (or any of its Principals or Affiliates) makes any unauthorized use or disclosure of any Confidential Information or Franchisor's trade secrets; or uses, duplicates or discloses any portion of the Manual in violation of this Agreement;
- (x) Franchisee and Franchisee's Principals or Operating Principal fails to comply with or perform its covenants, representations and warranties in this Agreement, including without limitation the representations, warranties and covenants set forth in Section 10, the representations and warranties with respect to anti-corruption, anti-boycott and anti-terrorism
laws set forth in Section 15 and the restrictive covenants against competition set forth in Section 17;
- (xi) Franchisee fails to pay any Continuing Service Fees or other amounts due hereunder to Franchisor within five days after Notice of nonpayment is delivered to Franchisee, or if Franchisee or its Affiliate fails to pay any amounts due to Franchisor under any promissory note or other written instrument and fails to cure such nonpayment within the time period prescribed therein;
- (xii) Franchisee under-states Gross Sales or fails to accurately report Gross Sales or its performance of any Designated Services, and does not correct such failure within three days after Notice of such failure is delivered to Franchisee, including without limitation payment of the Non-Reported Designated Services Fee for such failure to report performance of Designated Services;
- (xiii) Franchisee fails to pay when due any income, withholding, service, sales or any other applicable taxes due on the Bumper Business' operations, unless it is in good faith contesting its liability for such taxes and has effectively stayed the enforcement of liability for such taxes.
- (xiv) Franchisee fails to have in effect at all time the insurance coverages as required in Section 13 of this Agreement.
- (xv) Less than thirty-five percent (35%) of Franchisee's Gross Sales during each month in any consecutive two (2)-month period is generated from the repair of metal bumpers.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to the 2025 Bumper Man Franchise Disclosure Document, Bumper Man can terminate the franchise agreement with notice to the franchisee under certain conditions. Specifically, Bumper Man may terminate the agreement if the franchisee materially breaches the agreement or fails to comply with standards, but the franchisee typically has 30 days after receiving notice to correct the issue. However, there are some events of default that allow Bumper Man to terminate the agreement immediately upon delivery of notice to the franchisee.
Bumper Man will provide notice and an opportunity to cure for events such as material misrepresentations, failure to begin operating the business by the commencement date (with a 30-day cure period), abandonment of the business for five or more business days, failure to submit invoices for seven or more consecutive business days, surrendering control of the business without consent, misuse of the Bumper Man marks, or unauthorized transfers of the franchise. If the franchisee fails to comply with other material provisions of the agreement, Bumper Man can terminate the agreement if the franchisee does not correct the issue within 30 days after receiving notice.
However, the Bumper Man franchise agreement will terminate immediately upon delivery of notice to the franchisee if the franchisee fails on three or more separate occasions within 12 consecutive months to submit reports, pay amounts due, or materially comply with the agreement. The agreement will also terminate immediately if the franchisee is held liable or convicted of a felony or engages in dishonest conduct that could harm Bumper Man's reputation. Additionally, the agreement automatically terminates if the franchisee becomes insolvent or enters bankruptcy proceedings.