What are some examples of non-curable defaults that could lead to termination of a Crown Gold Exchange franchise agreement?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in franchise | Summary |
|---|---|---|
| or other agreement | ||
| not give us the right to terminate your franchise | ||
| agreement. However, if your franchise | ||
| agreement is terminated, we have the right to | ||
| terminate your MUDA. | ||
| g. “Cause” defined-- | Non-payment by you (10 days to cure); violate | |
| curable defaults | ||
| franchise agreement other than non-curable | ||
| default (30 days to cure). | ||
| h. “Cause” defined--non- | FA: Misrepresentation when applying to be a | |
| curable defaults | ||
| franchisee; knowingly submitting false | ||
| information; bankruptcy; lose possession of | ||
| your location; violation of law; violation of | ||
| confidentiality; violation of non-compete; | ||
| violation of transfer restrictions; slander or | ||
| libel of us; refusal to cooperate with our | ||
| business inspection; cease operations for more | ||
| than 5 consecutive days; three defaults in 12 | ||
| months; cross-termination; | ||
| conviction of, or plea to a felony, or | ||
| commission or accusation of an act that is | ||
| reasonably likely to materially and unfavorably | ||
| affect our brand; any other breach of franchise | ||
| agreement which by its nature cannot be cured. | ||
| MUDA: failure to meet development schedule; | ||
| violation of franchise agreement or other | ||
| agreement which gives us the right to terminate | ||
| it. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 29–33)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, there are several non-curable defaults that could lead to the termination of the franchise agreement. These defaults do not offer an opportunity for the franchisee to correct the issue before termination.
Examples of non-curable defaults related to the Franchise Agreement (FA) include misrepresentation when applying to become a franchisee or knowingly submitting false information. Further non-curable defaults are bankruptcy, losing possession of the business location, violating any law, violating confidentiality or non-compete agreements, violating transfer restrictions, or slandering or libeling Crown Gold Exchange. Refusing to cooperate with a business inspection, ceasing operations for more than five consecutive days, incurring three defaults within 12 months, or facing cross-termination are also non-curable defaults.
Additionally, conviction of or pleading to a felony, or committing or being accused of an act that could materially and unfavorably affect the Crown Gold Exchange brand, constitutes a non-curable default. Any other breach of the franchise agreement that inherently cannot be cured also falls under this category. For the Multi-Unit Development Agreement (MUDA), failure to meet the development schedule or violating the franchise agreement or any other agreement that grants Crown Gold Exchange the right to terminate it are considered non-curable defaults.