What is the effective date of the increased bond penalty for 7 Brew?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
_Picture_26.jpeg)
Kevin E. Hughes, Assistant Secretary
INCREASE PENALTY RIDER
BOND NO. 107883372
To be attached and form a part of Bond No. 107883372 dated the 13th Day of October, 2023, executed by Travelers Casualty and Surety Company of America as surety, on behalf of Brew Culture Franchise, LLC as current principal of record, and in favor of State of Maryland, as Obligee for Franchisor Bond, and in the amount of Six Hundred Thousand Dollars and 00/100 ($600,000.00).
In consideration of the agreed premium charged for this bond, it is understood and agreed that Travelers Casualty and Surety Company of America hereby consents that effective from the 11th Day of September, 2024, said bond shall be amended as follows:
THE BOND PENALTY SHALL BE INCREASED:
FROM: Six Hundred Thousand Dollars and
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, the increased bond penalty is effective as of September 11, 2024. The bond penalty increased from $600,000 to $850,000. This change is documented in an Increase Penalty Rider attached to Bond No. 107883372, which was initially dated October 13, 2023.
This increase in the bond penalty suggests that 7 Brew is taking measures to provide greater financial security to the State of Maryland, the obligee, in case Brew Culture Franchise, LLC, the principal, fails to meet its obligations. The surety, Travelers Casualty and Surety Company of America, consents to this amendment, ensuring the continuity of protection under the bond, albeit with the increased penalty amount.
For a prospective 7 Brew franchisee, this information is relevant because it reflects the financial safeguards and legal compliance measures that 7 Brew maintains. While the bond itself is not directly paid for by the franchisee, it provides an indirect assurance that 7 Brew is committed to fulfilling its obligations, which can impact the overall stability and reputation of the franchise system. Franchisees may want to inquire further about the specific obligations covered by the bond and the implications for them.