What constitutes 'cause' for cancellation of the Bw Premier Collection agreement?
Bw_Premier_Collection Franchise · 2025 FDDAnswer from 2025 FDD Document
- c. Either Party may cancel this Agreement upon thirty (30) days' notice with cause. Prior to such notice of cancellation, the Party alleging "cause" shall provide the other Party written notice of the "cause" and, if the breach is capable of being cured, allow for a fifteen (15) day cure period. For purposes of this Agreement, "cause" shall be defined as a Party's breach of a material term of this Agreement (e.g., if the
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Hotel fails to meet an obligation listed in Section 3 of this Agreement or there is a transfer or assignment in violation of paragraph 4.h.). In the event BWI cancels this Agreement for cause, Hotel will pay BWI liquidated damages in an amount calculated by taking the average of the prior twelve (12) months fees owed to BWI (but if fees have been owed to BWI for less than twelve (12) months, the average of all prior months) and multiplying that average by the lesser of: (i) twelve (12), or (ii) the remaining number of months in the Term.
Source: Item 23 — Receipts (FDD pages 54–203)
What This Means (2025 FDD)
According to the 2025 Bw Premier Collection FDD, 'cause' for cancellation of the agreement is defined as a party's breach of a material term of the agreement. Specifically, if the Hotel fails to meet an obligation listed in Section 3 of the agreement, or if there is a transfer or assignment in violation of paragraph 4.h, it can be considered 'cause' for cancellation.
Before canceling the agreement for cause, the party alleging the cause must provide written notice to the other party, allowing a 15-day cure period if the breach is capable of being cured. If Bw Premier Collection cancels the agreement for cause, the Hotel will be required to pay liquidated damages. These damages are calculated by averaging the fees owed to Bw Premier Collection over the prior twelve months (or all prior months if less than twelve months) and multiplying that average by the lesser of twelve or the remaining number of months in the term.
It is important to note that in Virginia, the definition of 'reasonable cause' may be subject to the Virginia Retail Franchising Act, potentially affecting the enforceability of certain default or termination grounds stated in the franchise agreement. Similarly, in Washington, the Washington Franchise Investment Protection Act may supersede the agreement in areas of termination and renewal, and court decisions may also have a similar effect. Therefore, prospective franchisees should be aware of these state-specific regulations that could impact the termination terms of their Bw Premier Collection franchise agreement.