If a Kitchen Solvers franchisee is in default, what actions can the franchisor take?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
rks and so alter the appearance of your Business premises (including motor vehicles or enclosed trailers, if any) as to differentiate your Business unmistakably from duly licensed KITCHEN SOLVERS businesses identified by the Trademarks. Upon your receipt of the written notice of termination, you may only complete previously ordered remodeling jobs or other types of projects and may not accept any new orders. Alternatively, at our option, we may require you to assign all existing customer contracts to us and pay to us any amounts (or a pro rata portion of any amounts) paid by your customers for services you have not yet performed, as we determine. For example, if a customer pre-paid for services and we determine that you had performed only 50% of the contracted services, we may require you to pay us 50% of the amount the customer paid to you. You must cease your participation in any KITCHEN SOLVERS web site and our intranet system and must discontinue your use of the Trademarks or System on the internet or other online communications. Furthermore, you must not use any of the KITCHEN SOLVERS Trademarks in a derogatory, negative, or other inappropriate manner in any media, including but not limited to print or electronic media. You also must take such action as may be required to cancel all assumed name or equivalent registrations relating to the use of any trade name or Trademarks and notify the telephone company and listing agencies of the termination or expiration of your right to use all telephone numbers of your Business and all classified and other directory listings of your Business and authorize the transfer of such numbers and directory listings to us or as we direct, all in accordance with the Assignment of Telephone Numbers attached as Appendix D. This agreement by you regarding the telephone numbers and listings is for the benefit of such telephone company serving you. You agree to hold any such telephone company harmless from any and all claims against it arising out of any orders given by us to terminate, transfer or put on referral such telephone service. Notwithstanding the foregoing, in the event of expiration or termination of this Agreement, you will remain liable for your indemnification obligations specified in Subparagraph 10.B or under common law and other obligations pursuant to any applicable lease for your Business premises or otherwise, which by their very nature are intended to survive the expiration or termination of this Agreement. Finally, you must comply with all noncompete covenants outlined in Subparagraph 10.D.
13. DISPUTE RESOLUTION; INJUNCTIVE RELIEF
We and you agree as follows:
A. Dispute Resolution.
- Mediation. The parties have reached this Agreement in good faith and in belief that it is advantageous to each of them. In recognition of the enormous strain on time, unnecessary expense and wasted resources potentially associated with litigation and/or arbitration, and in the spirit of cooperation, the parties pledge to try to resolve any dispute amicably, without litigation or arbitration. Other than an action by us under Section 13.A.3 or 13.B of this Agreement, before beginning any legal action or arbitration, the parties agree to mediate any dispute, controversy or claim between you and/or any of your owners, affiliates, officers, directors, shareholders, guarantors, employees, owners or members (each a "Franchisee Related Party"), on the one hand, and us, and/or any of our affiliates, officers, directors, shareholders, members, guarantors, employees, representatives, independent contractors or owners (each a "Franchisor Related
Party"), on the other hand, including, without limitation, in connection with any dispute, controversy or claim arising under, out of, in connection with or in relation to: (a) this Agreement; (b) any lease or sublease for your Franchised Business; (c) any loan or other finance arrangement between us and our affiliates and you; (d) the parties' relationship; (e) events occurring prior to the entry into this Agreement; (f) the Business; or (g) any System standard, in accordance with the procedures set forth in this Section 13.A.1, inclusive of all subparts. Good faith participation in these procedures to the greatest extent reasonably possible, despite lack of cooperation by one or more of the other parties, is a precondition to initiating any arbitration or legal action, including any action to interpret or enforce this Agreement. The Mediation shall be conducted in accordance with the following provisions:
- a. Initiation Procedure. The party seeking mediation (the "Initiating Party") must commence mediation by sending the other party/parties a written notice of its request for mediation (the "Dispute Notice"). The Dispute Notice will specify, to the fullest extent possible, the nature of the dispute, the Initiating Party's version of the facts surrounding the dispute, the amount of damages, and the nature of any injunctive or other relief such party claims, and must identify one or more persons with authority to settle the dispute for the Initiating Party.
- b.
Source: Item 22 — Contracts (FDD page 49)
What This Means (2025 FDD)
According to Kitchen Solvers' 2025 Franchise Disclosure Document, in the event of termination, Kitchen Solvers outlines several actions it may take. The franchisee can only complete previously ordered remodeling jobs or other projects and cannot accept new orders after receiving a written termination notice. Kitchen Solvers has the option to require the franchisee to assign all existing customer contracts to them. Additionally, Kitchen Solvers can make the franchisee pay any amounts (or a pro rata portion of any amounts) paid by customers for services not yet performed, as determined by Kitchen Solvers. For example, if a customer pre-paid for services and Kitchen Solvers determines that the franchisee had performed only 50% of the contracted services, Kitchen Solvers may require the franchisee to pay them 50% of the amount the customer paid.
Furthermore, the franchisee must discontinue participation in any Kitchen Solvers website and intranet system. They must also stop using the Kitchen Solvers trademarks or system on the internet or other online communications and must not use the Kitchen Solvers trademarks in a derogatory, negative, or other inappropriate manner in any media. The franchisee must also take action to cancel all assumed name or equivalent registrations relating to the use of any trade name or trademarks. They must notify the telephone company and listing agencies of the termination or expiration of the right to use all telephone numbers of the business and all classified and other directory listings of the business and authorize the transfer of such numbers and directory listings to Kitchen Solvers or as Kitchen Solvers directs.
Even after the agreement's expiration or termination, the franchisee remains liable for indemnification obligations and other obligations pursuant to any applicable lease for the business premises or otherwise, which by their very nature are intended to survive the expiration or termination of the agreement. Finally, the franchisee must comply with all noncompete covenants. Kitchen Solvers is authorized and empowered upon termination of the Franchise Agreement and without any further notice to the franchisee to notify the telephone company, as well as any other company that publishes telephone directories, to transfer the telephone numbers to them or such other person or entity as they designate. Kitchen Solvers is also granted an irrevocable power of attorney to take any necessary actions to assign the telephone numbers, including executing any forms that the telephone companies may require to effectuate the assignment.