If a Carbones Pizzeria franchisee abandons the restaurant, is that considered a curable default?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary |
|---|---|---|
| Franchise Agreement | ||
| a. Length of the Franchise term | Section 2 | 10 years from date of signing the Franchise Agreement |
| b. Renewal or extension of the term | Section 2 (See Note 2) | One 10 year term |
| c. Requirements for franchisee to renew or extend | Section 2 | Sign new agreement (which may contain materially different terms and conditions than your original Franchise Agreement), pay renewal fee, update your Restaurant to meet our then-current requirements for new restaurants |
| d. Termination by franchisee | None | Not applicable |
| e. Termination by franchisor without | None | Not applicable |
| cause | ||
| f. Termination by franchisor with cause | Section 15 | We may terminate only if you do one of the things described in Section 15 |
| g. "Cause" defined – curable defaults | Sections 15(e) through 15(f) | You have 30 days to cure nonpayment of fees, sanitation problems, non submission of reports and any other default not listed in Section 15 |
| h. "Cause" defined – non-curable defaults | Sections 15(a) through 15(d) | Non curable defaults include abandonment, trademark misuse and conviction of an offense directly related to the Restaurant business |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 24–26)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, abandonment of the restaurant is considered a non-curable default. This means that if a franchisee abandons their Carbones Pizzeria location, they do not have an opportunity to correct the issue and prevent termination of the franchise agreement.
This policy has significant implications for prospective franchisees. If a franchisee encounters difficulties and decides to abandon the business, Carbones Pizzeria can immediately terminate the agreement without providing a chance to rectify the situation. This differs from curable defaults, such as non-payment of fees or sanitation problems, where the franchisee is given a 30-day period to resolve the issue.
Franchisees should carefully consider the potential consequences of abandonment, as it leads to immediate termination. This non-curable default underscores the importance of thorough planning and commitment before entering into a franchise agreement with Carbones Pizzeria. Franchisees should ensure they have sufficient resources and a solid business plan to avoid circumstances that might lead to abandonment.