If an Eos Worldwide franchisee is convicted of a felony, can Eos Worldwide terminate the agreement?

According to the 2025 Eos Worldwide Franchise Disclosure Document, Eos Worldwide has the right to terminate the franchise agreement immediately if a franchisee is convicted of a felony. This is outlined in Section 17.2, which details non-curable defaults. This provision also applies if the franchisee pleads no contest or enters into a consent decree related to any violation of franchise, securities laws, or any crime that could negatively impact the reputation of Eos Worldwide, the franchisee, or the franchise system.

This clause protects Eos Worldwide from potential damage to its brand and reputation that could arise from a franchisee's criminal activities. The immediate termination upon conviction provides Eos Worldwide with a swift mechanism to disassociate itself from such detrimental conduct. It also covers situations where the franchisee might not be formally convicted but admits guilt through a no contest plea or consent decree.

For a prospective Eos Worldwide franchisee, this means that maintaining a clean legal record is crucial. Any conviction, plea, or decree related to the specified offenses could lead to immediate termination of the franchise agreement, resulting in the loss of the franchise and any associated investments. Franchisees should be aware of this clause and ensure they operate their business and conduct their personal affairs in a manner that avoids such legal issues.

This type of termination clause is relatively standard in franchise agreements across various industries, as franchisors typically want to safeguard their brand image and protect their franchise system from any negative publicity or legal liabilities stemming from franchisee misconduct.