Where is 'cause' defined for termination of the Face Foundrie Area Development Agreement, specifically regarding curable defaults?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
In recognition of the restrictions contained in Section 13.1-564 of the Virginia Retail Franchising Act, the Franchise Disclosure Document for Face Foundrié Franchising L.L.C. for use in the Commonwealth of Virginia shall be amended as follows:
Additional Disclosure: The following statements are added to Item 17.h. for the Franchise Agreement:
"Pursuant to Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to cancel a franchise without reasonable cause. If any ground for default or termination stated in the franchise agreement or development agreement does not constitute "reasonable cause;" as that term is defined in the Virginia Retail Franchising Act or the laws of Virginia, that provision may not be enforceable."
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION OF THE FRANCHISE RELATIONSHIP (FDD pages 51–59)
What This Means (2025 FDD)
Based on the 2025 Face Foundrie Franchise Disclosure Document, a specific definition of "cause" for termination of the Area Development Agreement, particularly concerning curable defaults, is not provided in the excerpts. While Item 17 discusses termination, renewal, transfer, and dispute resolution, it does not explicitly define "cause" in the context of the Area Development Agreement or detail the conditions for curable defaults.
However, the Virginia Addendum includes a statement related to "reasonable cause" for cancellation of a franchise, referencing Section 13.1-564 of the Virginia Retail Franchising Act. It notes that if any default or termination ground in the franchise or development agreement does not constitute "reasonable cause" as defined by Virginia law, that provision may not be enforceable in Virginia. This suggests that the term "cause" is subject to legal interpretation and may vary by jurisdiction.
To fully understand the definition of "cause" for termination and the handling of curable defaults in the Area Development Agreement, a prospective Face Foundrie area developer should consult the complete Area Development Agreement and seek clarification from Face Foundrie regarding specific termination clauses. It would also be prudent to consult with a legal professional to understand how local and state laws may affect the enforceability of these provisions.