What is the minimum amount of time the Exit Franchisee has to cure a default under section 16.1(A)(i)?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
- (ii) Upon the occurrence of an Event of Default described in Section 16.1(A)(i), Subfranchisor may terminate and cancel this Agreement upon thirty (30) days' prior written notice to Franchisee.
The notice shall demand immediate cure of the Event of Default and advise Franchisee that if the Event of Default specified in the notice is not cured within ten (10) days, all rights of Franchisee under this Agreement shall be cancelled and terminated without further notice 30 days from the date of the default notice.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, if a franchisee, or any entity controlled by them or their equity holders, fails to pay their financial obligations to Exit, the Subfranchisor, other Exit subfranchisors, or the Brokers' Council, including payments due under any promissory note, the subfranchisor may terminate the agreement. However, Exit provides a cure period.
The franchisee has ten days after receiving written notice to cure the default. The notice will demand immediate correction of the default and will inform the franchisee that if the default is not corrected within this ten-day period, all rights of the franchisee under the agreement will be canceled and terminated 30 days from the date of the default notice.
It is important to note that this cure period specifically applies to defaults under Section 16.1(A)(i), which concerns failure to meet financial obligations. Other types of defaults may have different cure periods or no cure period at all, as detailed elsewhere in Section 16 of the Exit Franchise Agreement.