factual

What constitutes 'cause' for termination of the Craters & Freighters franchise, specifically regarding curable defaults?

Craters_Freighters Franchise · 2025 FDD

Answer from 2025 FDD Document

Item Provision Section in Franchise Agreement Summary
g. "Cause" defined – curable defaults Section 19.2 Curable Defaults: You have 30 days to cure
any of the following defaults: non-payment of
any amount due and owing to us or any
Affiliate of ours as required by us pursuant to
the Franchise Agreement, Operations Manuals,
or otherwise; failure or refusal to submit, when
due, any report or other data, information, or
supporting records relating to the Franchised
Business; failure or refusal to accurately report
the Adjusted Gross Sales of the Franchised
Business; failure or refusal to operate a
warehouse within the Premises necessary for
the operation of the Franchised Business;
uncured default under the Lease for the
Premises; offer or sale of any products or
services not authorized by us; failure or refusal
to comply with the Operations Manuals or,
more specifically, any of the System Standards;
failure or refusal to pay any taxes due in
connection with your operation of the
Franchised Business; failure or refusal to
obtain and/or maintain all applicable licenses
and permits relating to the operation of the
Franchised Business; failure or refusal to
obtain our written approval or consent when
required; or failure or refusal to comply with
any other provision of the Franchise
Agreement, Operations Manuals, or any
System Standard.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTIONS (FDD pages 36–44)

What This Means (2025 FDD)

According to Craters & Freighters' 2025 Franchise Disclosure Document, certain defaults can lead to the termination of the franchise agreement, but some of these defaults are 'curable,' meaning the franchisee has an opportunity to correct the issue within a specified timeframe.

Specifically, Craters & Freighters franchisees have 30 days to cure several types of defaults. These include non-payment of any amount owed to Craters & Freighters or its affiliates, failure to submit required reports or data, inaccurate reporting of Adjusted Gross Sales, failure to operate a necessary warehouse on the premises, and uncured default under the lease for the premises.

Additional curable defaults include offering or selling unauthorized products or services, failing to comply with the Operations Manuals or System Standards, failing to pay taxes related to the Franchised Business, failing to obtain or maintain necessary licenses and permits, failing to obtain required written approval or consent from Craters & Freighters, and failing to comply with any other provision of the Franchise Agreement, Operations Manuals, or any System Standard. This means that if a franchisee commits any of these curable defaults, they have a 30-day window to rectify the situation and avoid termination of their franchise agreement.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.
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