If an Exit franchisee fails to comply with the agreement three or more times, do they have a right to cure?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
(iii) Franchisee fails to comply with the provisions of this Agreement three (3) or more times, whether or not corrected after notice.
(B) No Right to Cure.
Set forth below are events of default which, upon their occurrence, shall give Subfranchisor the right to terminate this Agreement after notice to Franchisee and with no right to cure, as described in Section 16.2:
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, an Exit franchisee does not have the right to cure if they fail to comply with the provisions of the franchise agreement three or more times. In such instances, the subfranchisor has the right to terminate the agreement after providing notice to the franchisee.
This lack of a cure period is a significant point for prospective franchisees. It means that repeated non-compliance, even if corrected after each notice, can lead to termination of the franchise agreement. Franchisees must ensure strict adherence to all terms and conditions of the agreement to avoid this situation.
Generally, franchisors include a cure period to allow franchisees to correct their mistakes. The Exit franchise agreement is stricter in this regard, as repeated violations, even if corrected, can still lead to termination. This places a greater responsibility on the franchisee to maintain consistent compliance with the agreement.