What constitutes a 'material obligation' for an Eos Worldwide franchisee, the default of which could lead to termination?
Eos_Worldwide Franchise · 2025 FDDAnswer from 2025 FDD Document
(e) fail to timely and successfully complete Boot Camp or any other mandatory training; or
(f) for Professional EOS Implementers, fail to meet the Minimum Performance Requirements for a Measurement Period pursuant to Section 10.16 of this Agreement, and fail to attend and actively participate in required Remedial Training as a result thereof pursuant to Section 10.16 of this Agreement; or
(g) breach Section 16 of this Agreement; or
(h) knowingly fail to accurately report payments to us, any affiliate, and/or any
supplier/creditor of ours or you commit any act or omission constituting fraud, misrepresentation or similar act or omission, whether with respect to us, any related entities and/or any third party; or
- (i) default, on three (3) or more separate occasions within any term of your Franchise, on any of your material obligations to us or an affiliate, whether or not cured (including failure to adhere to any of our Core Values), and/or other third parties, the Operations Manual or otherwise;
- (j) fail to commence operation of the Franchise within the time prescribed in Section 10.6 of this Agreement; or
- (k) fail to pay any taxes when due; or
- (l) make any misrepresentation on your franchise application or supporting documentation.
17.4 Cross Defaults, Non-Exclusive Remedies, Etc.
Any default by you under this Agreement may be regarded as a default under any other agreement between us (or any affiliate of ours) and you. Any default by you under any other agreement between us (or any of our affiliates) and you (or any person/company affiliated with you), and any default by you under any obligation to us (or any of our affiliates) may be regarded as a default under this Agreement. Any default by you (or any person/company affiliated with you) under any loan agreement, security agreement, lease, supply or service agreement or otherwise and that was signed in connection with the operation of your EOS Franchise, whether with us, any of our affiliates and/or any third party which is not cured by the time period specified in such agreement may be regarded as a default under this Agreement and/or any other agreement between us (or any of our affiliates) and you (or any of your affiliates). In each of the foregoing cases, we (and any of our affiliates) will have all remedies allowed at law, including termination of your rights (and/or those of any person/company affiliated with you) and our (and/or our affiliates') obligations. No right or remedy which we may have (including termination) is exclusive of any other right or remedy provided under law or equity and we may pursue any rights and/or remedies available.
Source: Item 23 — RECEIPTS (FDD pages 74–246)
What This Means (2025 FDD)
According to Eos Worldwide's 2025 Franchise Disclosure Document, a 'material obligation' is not explicitly defined; however, the document lists several instances where failure to meet obligations can lead to default and potential termination of the franchise agreement. Specifically, defaulting on three or more separate occasions within the franchise term on any material obligations to Eos Worldwide, its affiliates, or third parties can result in termination, regardless of whether the defaults were cured. This includes failure to adhere to Eos Worldwide's Core Values.
Other actions that can lead to termination include failing to complete mandatory training (Boot Camp), failing to meet Minimum Performance Requirements as a Professional EOS Implementer and not participating in required Remedial Training, breaching Section 16 of the agreement, knowingly failing to accurately report payments to Eos Worldwide or its affiliates/suppliers, failing to commence operation of the franchise within the prescribed time, failing to pay taxes when due, and making misrepresentations on the franchise application.
Additionally, any default by the franchisee under any agreement with Eos Worldwide or its affiliates can be considered a default under the franchise agreement. This includes defaults under loan agreements, security agreements, leases, or supply/service agreements signed in connection with the operation of the Eos Worldwide franchise, whether with Eos Worldwide, its affiliates, or third parties. These defaults can trigger termination if not cured within the specified time period in those agreements. Eos Worldwide retains broad discretion in determining what constitutes a default and the remedies it may pursue, including termination.