Does the Coffee News franchise agreement allow for defaults that can be cured?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| g. "Cause" defined defaults | None, Exhibit A | There exists no provisions for |
| which can be cured. | defaults which may be cured. | |
| h. "Cause" defined defaults that cannot be cured. | Sections 13.1, 13.2, Exhibit A | Waivers for prior breaches or defaults are not binding against same or different breaches or defaults. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 25–27)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, the franchise agreement does not include provisions for defaults that can be cured. This means that if a franchisee breaches any part of the franchise agreement, Coffee News USA has grounds for termination without providing an opportunity for the franchisee to correct the issue. This is a notable point for prospective franchisees to consider, as even a minor infraction could lead to the termination of their franchise agreement.
In contrast, many franchise systems allow franchisees a period to cure certain defaults, providing an opportunity to rectify the situation and maintain their franchise. The absence of a cure provision in the Coffee News agreement places a greater responsibility on the franchisee to strictly adhere to all terms and conditions of the agreement.
The FDD also states that waivers for prior breaches or defaults are not binding against same or different breaches or defaults. This implies that Coffee News's leniency towards a franchisee on one occasion does not prevent them from taking action for similar or different breaches in the future. Prospective franchisees should carefully evaluate their capacity to consistently meet all obligations outlined in the franchise agreement, given the lack of a cure provision and the non-binding nature of waivers.