Is repeated curable defaults considered a non-curable default for a Deck Medic franchise?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
| d. | Termination by franchisee | 16.B. | You may terminate the Franchise Agreement if you are in |
|---|---|---|---|
| compliance with its terms, we are in material breach of the Franchise Agreement, and we fail to cure the material breach within 30 days of receiving written notice or, if the breach cannot be cured within 30 days, such period of time that is reasonable to cure the material breach. | |||
| e. | Termination by franchisor without cause | Not applicable | Not applicable. |
| f. | Termination by franchisor with "cause" | 16.A. | We can terminate if you are in default of the terms of the Franchise Agreement. |
| g. | "Cause" defined-curable defaults | 16.A.(3), 16.A.(4) | You have 10 days to cure a default where you fail to pay any fees and/or obligations due to us and/or to an affiliate of ours or if you fail to pay a supplier without, as determined by us, a legal justification, provided that the foregoing defaults were not intentionally and knowingly in violation of the Franchise Agreement. You will have 30 days to cure a default where you fail to: timely lease a location that we approve for your Deck Medic Business; timely develop and open your Deck Medic Business; operate your Deck Medic Business in accordance with the specifications, standards, and requirements set forth in our Manuals; develop or operate your Deck Medic Business in compliance with all federal, state, and local laws, rules, and regulations, unless, such violation poses a threat to public health or safety; maintain insurance coverage that we require; comply with our standards, systems or specifications as we may designate or as otherwise designated in the operations manual; fail to operate your Deck Medic Business in conformity with our System or otherwise violate the Franchise Agreement, except as to events of default that are not curable. |
| h. | "Cause" defined-non-curable defaults | 16.A.(1), 16.A.(2) | The following are defaults that cannot be cured: three or more instances where you commit a curable default, whether or not you timely cured such default in each instance; you intentionally and knowingly refuse to comply with the terms of the Franchise Agreement, and/or the standards specifications, and/or requirements set forth in the operations manual and/or as communicated to you by us from time to time; you intentionally, knowingly, or negligently operate the Franchised Business in violation of applicable laws, rules, and regulations and, in doing so, create a foreseeable, imminent, and/or immediate threat to the health and safety of others; you abandon the Franchised Business; you or your Owners intentionally made a material |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 34–39)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, committing three or more curable defaults, even if each was individually cured in a timely manner, is considered a non-curable default. This means that Deck Medic can terminate the franchise agreement if a franchisee repeatedly violates the agreement, regardless of whether they fix the issues each time.
This policy has significant implications for prospective franchisees. It emphasizes the importance of consistently adhering to the terms of the franchise agreement and operational standards. Even minor, easily correctable infractions can accumulate and lead to termination if they occur frequently. This highlights the need for careful management and diligent adherence to Deck Medic's system.
Franchisees should be aware that Deck Medic views repeated curable defaults as a serious issue, indicating a fundamental problem with the franchisee's ability or willingness to follow the franchise system. This policy is stricter than some franchise systems, which might only consider uncured defaults as grounds for termination. Therefore, franchisees must prioritize compliance to avoid accumulating curable defaults.
It is important for potential Deck Medic franchisees to fully understand all the terms and conditions of the franchise agreement, especially those related to defaults and termination. They should seek clarification from Deck Medic on what constitutes a curable default and how the company tracks and addresses such issues. Understanding these details is crucial for maintaining a successful and long-term franchise relationship.