Does the Security Agreement outline conditions under which Epcon Communities can terminate the franchise with cause?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Article or Section in Security Agreement | Summary | |
|---|---|---|---|
| a. | Length of the franchise term | Paragraph 19 | Terminates upon full performance, payment and satisfaction of your obligations. |
| b. | Renewal or extension of the term | Paragraphs 3 and 4 | You authorize us to file financing statements and amendments and agree to sign, deliver to us, or file financing statements and amendments relating to the collateral. |
| c. | Requirements for franchisee to renew or extend | Not Applicable | Not Applicable. |
| d. | Termination by franchisee | Not Applicable | Not Applicable. |
| e. | Termination by franchisor without cause | Not Applicable | Not Applicable. |
| f. | Termination by franchisor with cause | Not Applicable | Not Applicable. |
| g. | "Cause" defined – curable | Not Applicable | Not Applicable. |
| h. | "Cause" defined – non curable | Not Applicable | Not Applicable. |
| i. | Franchisee's obligations on termination/non-renewal | Not Applicable | Not Applicable. |
| j. | Assignment of contract by franchisor | Not Applicable | Not Applicable. |
| k. | "Transfer" by franchisee – defined | Not Applicable | Not Applicable. |
| l. | Franchisor approval of transfer by franchisee | Not Applicable | Not Applicable. |
| m. Conditions for franchisor approval of transfer | Not Applicable | Not Applicable. | |
| n. | Franchisor's right of first refusal to acquire franchisee's business | Not Applicable | Not Applicable. |
| o. | Franchisor's option to purchase franchisee's business | Not Applicable | Not Applicable. |
| p. | Death or disability of franchisee | Not Applicable | Not Applicable. |
| q. | Non-competition covenants during the term of the franchise | Not Applicable | Not Applicable. |
| r. | Non-competition covenants after the franchise is terminated or expires | Not Applicable | Not Applicable. |
| s. | Modification of the Agreement | Not Applicable | Not Applicable. |
| t. | Integration/merger clause | Not Applicable | Not Applicable. |
| u. | Dispute resolution by arbitration or mediation | Not Applicable | Not Applicable. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 55–69)
What This Means (2025 FDD)
According to Epcon Communities' 2025 Franchise Disclosure Document, the Security Agreement addresses termination. The table regarding the Security Agreement indicates that the length of the franchise term, as outlined in Paragraph 19, terminates upon full performance, payment, and satisfaction of the franchisee's obligations. However, the table indicates that termination by the franchisor, either with or without cause, is 'Not Applicable' to the Security Agreement.
This suggests that while the Security Agreement outlines the conditions for its own termination (i.e., after all obligations are met), it does not specify conditions under which Epcon Communities can terminate the franchise agreement itself for cause. The Security Agreement primarily concerns the financial obligations and security interests related to the franchise, not the broader operational or compliance aspects that might lead to a termination for cause.
Prospective franchisees should carefully review the Franchise Agreement itself and other related documents to understand the circumstances under which Epcon Communities can terminate the franchise relationship with cause. It would be prudent to seek clarification from Epcon Communities regarding the specific conditions that could lead to a termination for cause and how those conditions are defined and enforced.