What happens if a levy or execution is made against a Crown Gold Exchange business?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
- (c) Without Cure Period. Crown Gold Franchising may terminate this Agreement by giving notice to Franchisee, without opportunity to cure, if any of the following occur:
- (iii) a receiver or trustee for the Business or all or substantially all of Franchisee's property is appointed by any court, or Franchisee makes a general assignment for the benefit of Franchisee's creditors, or Franchisee is unable to pay its debts as they become due, or a levy or execution is made against the Business, or an attachment or lien remains on the Business for 30 days unless the attachment or lien is being duly contested in good faith by Franchisee, or a petition in bankruptcy is filed by Franchisee, or such a petition is filed against or consented to by Franchisee and the petition is not dismissed within 45 days, or Franchisee is adjudicated as bankrupt;
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to the 2024 Franchise Disclosure Document, Crown Gold Exchange can terminate the Franchise Agreement without allowing the franchisee an opportunity to cure the issue if a levy or execution is made against the Crown Gold Exchange business. This means that if a legal judgment results in a seizure of assets or property of the business, Crown Gold Exchange has the right to immediately terminate the agreement.
Additionally, Crown Gold Exchange can terminate the agreement, without opportunity to cure, if the franchisee is unable to pay debts as they become due, or an attachment or lien remains on the business for 30 days unless the attachment or lien is being duly contested in good faith by Franchisee, or a petition in bankruptcy is filed by Franchisee, or such a petition is filed against or consented to by Franchisee and the petition is not dismissed within 45 days, or Franchisee is adjudicated as bankrupt.
This clause is significant for prospective franchisees as it highlights the importance of maintaining sound financial standing and managing the business to avoid legal judgments or financial distress. The immediate termination provision underscores the potential risks associated with financial instability and the importance of adhering to the terms of the Franchise Agreement to avoid such circumstances.