If Kitchen Solvers terminates a franchise agreement, is termination of the Development Agreement automatic?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
| e. Termination by us without cause | None | Termination of Development Agreement does not permit us to terminate a single-unit franchise agreement. We do have the right to terminate the development agreement if we have terminated a franchise agreement entered into between you and us. | | f. Termination by us with cause | Section 5.2 | We can terminate you for cause. Termination of Development Agreement does not permit us to terminate a single-unit franchise agreement. We do have the right to terminate the development agreement if we have terminated a franchise agreement entered into between you and us. | | g. "Cause" defined – defaults which can be cured | Agreement Section 5.2 | If you commit a default under the ADA (other than the type of default disclosed in (h) below, which defaults are non-curable), you have 15 days after you receive notice from us to cure the default identified in the notice. Termination of Development Agreement does not permit us to terminate a single-unit franchise agreement. We do have the right to terminate the development agreement if we have terminated a franchise agreement entered into between you and us. | | h. "Cause" defined – non-curable defaults | Section 5.2 | We have the right to terminate the ADA effective immediately on notice to you if you commit a Material Default, including: (i) you fail to meet your Minimum Development Obligations; (ii) you commit any conduct that impairs the goodwill associated with the marks or otherwise causes harm to us or the reputation of the brand or the System; (iii) the termination of any Franchise Agreement entered into by you or any of your affiliates and us and any of our affiliates; (iv) uncured default under any such Franchise Agreement; (v) violation of the confidentiality and/or non-competition covenants; and (vi) failure to cure any other default within 15 days after notice. Termination of Development Agreement does not permit us to terminate a single-unit franchise agreement. We do have the right to terminate the development agreement if we have terminated a franchise agreement entered into between you and us. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 36–40)
What This Means (2025 FDD)
According to Kitchen Solvers's 2025 Franchise Disclosure Document, the termination of a franchise agreement can lead to the termination of the Development Agreement. Specifically, Kitchen Solvers has the right to terminate the Development Agreement if they have terminated a franchise agreement between the franchisee and Kitchen Solvers.
This means that if a Kitchen Solvers franchisee breaches the Franchise Agreement and Kitchen Solvers terminates that agreement, Kitchen Solvers also has the right to terminate the Development Agreement. This is a significant point for prospective franchisees to consider, as it links the fate of the Development Agreement to the performance and adherence to the terms of the Franchise Agreement.
This clause protects Kitchen Solvers by allowing them to sever all ties with a franchisee who has proven to be non-compliant or detrimental to the brand. It also ensures that Kitchen Solvers can maintain control over the development and operation of its franchises, preventing a franchisee who has lost their franchise from continuing to develop new locations under the Development Agreement. A prospective franchisee should seek clarification regarding the specific conditions under which a Franchise Agreement might be terminated and how that would impact the Development Agreement.