What is the timeframe for a bankruptcy proceeding against a Dog Haus franchisee to remain undismissed before it triggers a receipt?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee (i) is adjudicated bankrupt or institutes (by petition, application, answer, consent or otherwise) any bankruptcy, insolvency, reorganization, moratorium, arrangement, readjustment of debt, dissolution, liquidation or similar proceeding relating to it under the laws of any jurisdiction; or (ii) any such proceeding is instituted (by petition, application or otherwise) against Franchisee and remains undismissed for a period of sixty (60) days.
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, a bankruptcy proceeding instituted against a franchisee must be dismissed within sixty days to avoid triggering certain actions related to receipts. Specifically, if a bankruptcy, insolvency, reorganization, or similar proceeding is initiated against the Dog Haus franchisee and remains undismissed for 60 days, it can trigger consequences under the franchise agreement.
This means that if a franchisee faces such legal actions, they have a limited time frame to resolve the issue. Failure to have the proceeding dismissed within this period could lead to the franchisor taking actions as outlined in the franchise agreement, potentially impacting the franchisee's rights and obligations.
This clause protects Dog Haus by ensuring that franchisees maintain financial stability and operational viability. The 60-day window provides a reasonable period for franchisees to address such issues, while also safeguarding the brand's interests if the franchisee's financial difficulties persist.