Under what conditions can Crawlspace Medic terminate the franchise agreement with cause?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
Section in Franchise Provision Agreement Summary h. "Cause" defined - non-curable Sections 17.1 and The Franchise Agreement will terminate defaults 17.2 automatically, without notice for the following defaults: insolvency; bankruptcy; written admission of inability to pay debts; receivership; levy; composition with creditors; unsatisfied final judgment for more than 30 days; or foreclosure proceeding that is not dismissed within 30 days. We may terminate the Franchise Agreement upon notice to you if you: do not open the Franchised Business within required time frames; falsify any report to us; cease operations for 5 days or more, unless your vehicle is being repaired/replaced; fail to restore and re open the Franchised Business within 120 days after a casualty; fail to comply with applicable laws; default under any lease for the premises; understate Gross Revenue two (2) or more times; fail to comply with insurance and indemnification requirements; attempt a transfer in violation of the Franchise Agreement; fail, or your legal representative fails to transfer as required upon your death or permanent disability; misrepresent or omit a material fact in applying for the Franchise; are convicted or plead no contest to a felony or crime that could damage the goodwill or reputation of the Marks or the System; receive an adverse judgment in any proceeding involving allegations of fraud, racketeering or improper trade practices or similar claim that could damage the goodwill or reputation of the Marks or the System; conceal revenues or maintain false books; create a threat or danger to public health or safety; refuse an inspection or audit by us; use the Marks, copyrighted material or Confidential Information in an unauthorized manner; make an unauthorized disclosure of Confidential Information; fail to comply with non competition covenants; default in the performance of your obligations three (3) or more times during the term or receive two (2) or more default notices in any 12-month period; default under any other agreement with us or our affiliate; have insufficient funds to honor a check or EFT two (2) or more times within any twelve (12)-month period; fail to maintain Minimum Performance Requirements in any single year of operation; or terminate the Franchise Agreement without cause.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 33–38)
What This Means (2024 FDD)
According to Crawlspace Medic's 2024 Franchise Disclosure Document, the franchise agreement can be terminated with cause under several specific conditions. Some defaults will result in automatic termination without notice, while others require Crawlspace Medic to provide notice before termination.
Automatic termination events include situations indicating financial instability or legal issues, such as insolvency, bankruptcy, admitting inability to pay debts, receivership, levy, making a composition with creditors, having an unsatisfied final judgment for more than 30 days, or facing a foreclosure proceeding not dismissed within 30 days.
Crawlspace Medic may terminate the Franchise Agreement with notice if the franchisee fails to open the franchised business on time, falsifies reports, ceases operations for 5 or more days (unless due to vehicle repair/replacement), fails to reopen after a casualty within 120 days, doesn't comply with laws, defaults on a lease, understates gross revenue two or more times, fails to meet insurance/indemnification requirements, attempts unauthorized transfers, fails to transfer upon death/disability, misrepresents facts in the franchise application, is convicted of a relevant felony, receives an adverse judgment related to fraud, conceals revenues, endangers public health, refuses inspections, misuses trademarks/confidential information, violates non-competition agreements, defaults repeatedly, has insufficient funds for checks/EFTs multiple times, fails to maintain Minimum Performance Requirements, or terminates the agreement without cause.