What is the effect of Crisp & Green exercising its right to terminate the agreement after a default?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
18.03 Exercise of Rights. The rights of us and you hereunder are cumulative and no exercise or enforcement by us or you of any right or remedy hereunder shall preclude the exercise or enforcement by us or you of any other right or remedy hereunder which we or you are entitled to enforce by law. If you commit any act of default under this Agreement for which we exercise our right to terminate this Agreement, you shall pay to us all actual, consequential, special and incidental damages we incur as a result of the premature termination of this Agreement regardless of whether or not such damages are reasonably foreseeable. You acknowledge and agree that the proximate cause of such damages sustained by us is your act of default and not our exercise of our right to terminate.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, if a franchisee commits an act of default that leads Crisp & Green to exercise its right to terminate the agreement, the franchisee is responsible for paying Crisp & Green all actual, consequential, special, and incidental damages the company incurs as a result of the premature termination. This obligation exists regardless of whether these damages were reasonably foreseeable.
The FDD clarifies that the franchisee acknowledges and agrees that the proximate cause of these damages is the franchisee's act of default, not Crisp & Green's decision to terminate the agreement. This means that the franchisee is held responsible for the financial repercussions stemming from their failure to uphold the agreement, shifting the financial burden of the termination onto the franchisee.
Furthermore, Crisp & Green retains cumulative rights, meaning that exercising one right or remedy does not prevent them from pursuing any other right or remedy available under the law. This could include seeking injunctive relief in court to prevent conduct that may cause irreparable harm, such as violations of specific sections related to proprietary information or non-compete clauses. In such cases, Crisp & Green may seek injunctive relief without posting a bond, and the franchisee's sole recourse would be to seek dissolution of the injunction if warranted.