Is there an exception to the cure period for failing to pay a supplier for Casiola?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
| v. Choice of forum | 18.G. | All mediation, arbitration and, if applicable, litigation proceedings | |---|---|---| | | | must be conducted in, or closest to, State court of general | | | | jurisdiction that is within or closest to Orange County, Florida or, | | | | if appropriate, the United States District Court nearest to our | | | | corporate headquarters at the time such action is filed. This | | | | provision is subject to applicable state law. | | w. Choice of law | 18.F. | Florida law will govern. However, this provision is subject to state | | | | law and as otherwise disclosed in Exhibit I to this Disclosure | | | | Document. |
| g. | "Cause" defined-curable defaults | 16.A.(3), 16.A.(4) | You have 10 days to cure a default where you fail to pay any fees and/or obligations due to us and/or to an affiliate of ours or if you fail to pay a supplier without, as determined by us, a legal justification, provided that the foregoing defaults were not intentionally and knowingly in violation of the Franchise Agreement.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 35–39)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, a franchisee typically has 10 days to cure a default if they fail to pay a supplier. However, this cure period is not applicable if Casiola determines that there is no legal justification for the failure to pay. Additionally, the 10-day cure period is voided if the failure to pay the supplier was an intentional and knowing violation of the Franchise Agreement.
This means that a Casiola franchisee needs to ensure timely payments to suppliers, and that any failure to pay must have a valid legal reason that Casiola accepts. If a franchisee knowingly and intentionally violates the Franchise Agreement by not paying a supplier, Casiola can immediately terminate the agreement without providing an opportunity to cure the default.
This condition is stricter than a simple failure to pay, as it requires Casiola to prove the franchisee acted intentionally and knowingly. However, it places the onus on the franchisee to demonstrate a valid legal justification for non-payment to avoid potential termination of the franchise agreement.