Under what circumstances does the 90-day notice provision for termination, cancellation, or nonrenewal NOT apply to a Crisp & Green franchise in Rhode Island?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
Section 6-50-4 of the Rhode Island Fair Dealership Law includes the requirement that, in certain circumstances, a franchisee receive 90 days' notice of termination, cancellation, non-renewal or substantial change in competitive circumstances. The notice shall state all the reasons for termination, cancellation, non-renewal or substantial change in competitive circumstances and shall provide that the franchisee has 60 days in which to rectify any claimed deficiency and shall supersede the requirements of the Franchise Agreement to the extent they may be inconsistent with the Law's requirements. If the deficiency is rectified within 60 days the notice shall be void. The above-notice provisions shall not apply if the reason for termination, cancellation or nonrenewal is insolvency, the occurrence of an assignment for the benefit of creditors or bankruptcy. If the reason for termination, cancellation, nonrenewal or substantial change in competitive circumstances is nonpayment of sums due under the Franchise Agreement, Franchisee shall be entitled to written notice of such default, and shall have 10 days in which to remedy such default from the date of delivery or posting of such notice.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, a Rhode Island addendum modifies the standard franchise agreement. Specifically, it addresses the 90-day notice requirement for termination, cancellation, or non-renewal as mandated by the Rhode Island Fair Dealership Law. However, this 90-day notice provision does not apply under certain conditions.
Notably, the 90-day notice is waived if the reason for termination, cancellation, or nonrenewal is due to the franchisee's insolvency, an assignment for the benefit of creditors, or bankruptcy. These circumstances allow Crisp & Green to proceed with termination without the standard 90-day notice period.
Additionally, if the reason for termination, cancellation, nonrenewal, or substantial change in competitive circumstances is due to nonpayment of sums owed to Crisp & Green under the Franchise Agreement, the franchisee is entitled to a written notice of default. In this case, the franchisee has only 10 days from the date of the notice to remedy the default, a significantly shorter period than the standard 90-day notice and 60-day cure period that applies to other breaches.