What is the minimum content required in the notice of default sent by the Exit Subfranchisor?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall have the right to terminate this Agreement by not less than thirty (30) days written notice to Subfranchisor, if Subfranchisor is in default in the performance or observance of any agreement, covenant, provision or term contained in this Agreement and the default, which remains uncured for more than thirty (30) days after written notice of the default is given to Subfranchisor. Franchisee waives all claims to all damages except direct damages necessarily arising from the alleged default against which notice is given and which remains uncured.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
Based on the 2025 Exit Franchise Disclosure Document, if the Exit Subfranchisor is in default of the franchise agreement, the franchisee must provide written notice of the default to the subfranchisor. The subfranchisor then has thirty days to cure the default. If the default remains uncured after this 30-day period, the franchisee has the right to terminate the agreement.
It is important to note that the franchisee waives all claims to damages except direct damages that necessarily arise from the alleged default. This waiver only applies to defaults for which written notice has been given and which remain uncured.
This means that as a prospective Exit franchisee, you must provide written notice to the subfranchisor of any default and allow them a 30-day cure period before terminating the agreement. Failure to provide proper notice and opportunity to cure could result in legal complications if you later seek to terminate the agreement and claim damages.