Under what conditions can Stretch Zone terminate the Area Development Agreement with cause?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Area Development Agreement | Summary |
|---|---|---|
| f. Termination by us | Section 7.2 | We may only terminate your Area Development |
| with cause | Agreement with cause. | |
| g. “Cause” defined – curable defaults | Section 7.3 | You have 30 days or any longer period as applicable law may require, after written notice of default to cure any default and provide evidence of cure satisfactory to us. If you fail to cure timely any curable default, we have the right to terminate the Area Development Agreement effective upon your receipt of our written notice of termination. You have the burden of proving you have timely cured any default, to the extent it is a curable default under the Area Development Agreement. Upon |
| h. "Cause" defined – non-curable defaults | Section 7.2 | We may terminate the Area Development Agreement by giving you written notice of termination if we terminate any Franchise Agreement between the parties due to your default, after we have given you written notice of default if notice is required, and afforded you an opportunity to cure if you have a right to cure. |
Source: Item 17 — ITEM -17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 65–73)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, Stretch Zone may terminate the Area Development Agreement with cause, as detailed in Section 7.2 of the agreement. The specific conditions constituting 'cause' are further defined in two categories: curable defaults (Section 7.3) and non-curable defaults (Section 7.2).
For curable defaults, Stretch Zone must provide written notice, and the franchisee has 30 days (or any longer period required by applicable law) to cure the default and provide satisfactory evidence of the cure. Failure to cure within the given timeframe allows Stretch Zone to terminate the agreement upon written notice. The franchisee bears the responsibility of proving timely cure of any curable default.
Regarding non-curable defaults, Stretch Zone can terminate the Area Development Agreement with written notice if any Franchise Agreement between the parties is terminated due to the franchisee's default. This termination can occur after Stretch Zone has provided written notice of the default (if notice is required) and given the franchisee an opportunity to cure the default if a right to cure exists. This means that a breach of the franchise agreement for an individual Stretch Zone location can trigger termination of the broader area development agreement.