What constitutes a material violation of the Care Plus Medical Ucc franchise agreement?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
(i) Franchisee misrepresented or omitted material facts when applying to be a franchisee, or breaches any representation in this Agreement;
(ii) Franchisee knowingly submits any false report or knowingly provides any other false information to Care Plus Medical UCC;
(iii) a receiver or trustee for the Business or all or substantially all of Franchisee's property is appointed by any court, or Franchisee makes a general assignment for the benefit of Franchisee's creditors, or Franchisee is unable to pay its debts as they become due, or a levy or execution is made against the Business, or an attachment or lien remains on the Business for 30 days unless the attachment or lien is being duly contested in good faith by Franchisee, or a petition in bankruptcy is filed by Franchisee, or such a petition is filed against or consented to by Franchisee and the petition is not dismissed within 45 days, or Franchisee is adjudicated as bankrupt;
(iv) Franchisee fails to open for business by the date specified on the Summary Page;
(v) Franchisee loses possession of the Location;
(vi) Franchisee or any Owner commits a material violation of Section 7.2 (compliance with laws) or Section 13.1 (confidentiality), violates Section 13.2 (non-compete) or Article 15 (transfer), or commits any other violation of this Agreement which by its nature cannot be cured;
(vii) Franchisee abandons or ceases operation of the Business for more than five consecutive days;
(viii) Franchisee or any Owner slanders or libels Care Plus Medical UCC or any of its employees, directors, or officers;
(ix) Franchisee refuses to cooperate with or permit any audit or inspection by Care Plus Medical UCC or its agents or contractors, or otherwise fails to comply with Section 10.5 or Section 11.2;
(x) the Business is operated in a manner which, in Care Plus Medical UCC's reasonable judgment, constitutes a significant danger to the health or safety of any person, and
Franchisee fails to cure such danger within 48 hours after becoming aware of the danger (due to notice from Care Plus Medical UCC or otherwise);
(xi) Franchisee has received two or more notices of default and Franchisee commits another breach of this Agreement, all in the same 12-month period;
(xii) Care Plus Medical UCC (or any affiliate) terminates any other agreement with Franchisee (or any affiliate) due to the breach of such other agreement by Franchisee (or its affiliate) (provided that termination of a Multi-Unit Development Agreement with Franchisee or its affiliate shall not give Care Plus Medical UCC the right to terminate this Agreement);
(xiii) Franchisee or any Owner is charged with, pleads guilty or no-contest to, or is convicted of a felony; or
(xiv) Franchisee or any Owner is accused by any governmental authority or third party of any act, or if Franchisee or any Owner commits any act or series of acts, that in Care Plus Medical UCC's opinion is reasonably likely to materially and unfavorably affect the Care Plus Medical brand.
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to the 2024 Care Plus Medical Ucc Franchise Disclosure Document, several actions can constitute a material violation of the franchise agreement. These include misrepresenting or omitting material facts during the application process, submitting false reports or information to Care Plus Medical UCC, and the appointment of a receiver or trustee for the business. Additional violations include the franchisee making a general assignment for the benefit of creditors, being unable to pay debts, or facing a levy or execution against the business that remains for 30 days. Filing for bankruptcy or losing possession of the location also constitute material violations.
Further, a Care Plus Medical Ucc franchisee materially violates the agreement if they do not open for business by the specified date, violate confidentiality or non-compete agreements, or abandon the business for more than five consecutive days. Slandering or libeling Care Plus Medical UCC or its employees, refusing to cooperate with audits or inspections, or operating the business in a way that endangers health or safety also constitute material violations. Failure to cure a dangerous condition within 48 hours of awareness, receiving multiple default notices, or termination of another agreement with Care Plus Medical UCC due to a breach are also grounds for termination.
Finally, if a Care Plus Medical Ucc franchisee or any owner is charged with or convicted of a felony, or if their actions are likely to negatively affect the Care Plus Medical brand, it is considered a material violation. These stipulations are fairly standard in franchising, designed to protect the brand and ensure compliance with the franchise agreement. Franchisees should be aware of these potential violations to avoid termination of their agreement.