Does the Craters & Freighters Franchise Agreement outline the process for curing a default?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
h. "Cause" defined – non-curable Section 19.1 Non-Curable Defaults: failure or refusal to defaults open the Franchised Business within 90 days after execution of the Franchise Agreement; the making of any material misrepresentation or omission in applying to be a Craters & Freighters franchisee; you or any other required attendee(s) fail to attend and complete, to our satisfaction, the initial training program; abandonment of the Franchised Business; criminal conduct by you, any principal owner of the franchisee entity, or any owner of franchisee entity owning more than owner of the franchisee entity, or any owner of franchisee entity owning more than 10% of the franchisee entity engages in any act or conduct which, in our sole determination, materially impairs the goodwill and/or reputation of the System or Marks, and you fail or refuse to take corrective measures to promptly minimize or eliminate the negative impact of such act or conduct; repeated 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; a course of conduct which includes any misrepresentations or deceptive or unlawful acts or practices in connection with offering and/or selling products and services to customers; failure, refusal, or neglecting to take appropriate and necessary measures to protect any employee or customer from imminent and significant danger due to any health or safety matter in connection with the operation of the Franchised Business (or committing repeated violations of any health or safety-related law, standard, or practice); unauthorized use or disclosure of the Marks, Confidential Information, Trade Secrets, Operations Manuals, or Proprietary Software; intentional understatement of the Franchised Business's Adjusted Gross Sales in any report or financial statement; failure or refusal to comply with any of the in-term restrictive covenants set forth in the Franchise Agreement; uncured default under any other agreement with us or any of our Affiliates 10% of the franchisee entity; you, any principal (including, but not limited to, another franchise agreement or a promissory note); unauthorized
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTIONS (FDD pages 36–44)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, the franchise agreement outlines conditions considered non-curable defaults. These include failing to open the franchised business within 90 days after signing the agreement, making misrepresentations when applying to be a franchisee, not completing the initial training program, abandoning the business, engaging in criminal conduct that impairs the goodwill of the system, repeated non-payment, deceptive acts when selling products, failing to protect employees or customers from health and safety dangers, unauthorized use of trademarks or confidential information, understating gross sales, not complying with restrictive covenants, and uncured default under any other agreement with Craters & Freighters or its affiliates.
These defaults, as defined in Section 19.1 of the Craters & Freighters Franchise Agreement, are considered so severe that they cannot be remedied, leading to potential termination of the franchise agreement. This differs from curable defaults, where the franchisee is given an opportunity to correct the issue within a specified timeframe to avoid termination.
Prospective Craters & Freighters franchisees should be aware of these non-curable defaults and understand that any of these actions could result in immediate termination of their franchise agreement. It is important to seek legal counsel to fully understand the implications of these clauses before entering into the agreement.