If Azal Coffee purchases insurance for the franchisee, what is the franchisee's obligation regarding payment?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
We will have the right to engage a vendor to consult with and advise Azal Coffee franchisees on compliance with the PCI Requirements and Information Security Standards and to require you to pay a portion of the cost of the vendor's services as determined under our policies and procedures or to directly engage the vendor for these purposes. Also, we have the right to acquire a cyber insurance policy for the Azal Coffee franchise system and to require you to pay a portion of the cost of the cyber insurance policy as determined under our policies and procedures. We will have the
right to collect your share of the costs of the vendor and/or cyber insurance policy on a periodic basis in the manner provided in Section 4.13 of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, Azal Coffee has the right to acquire a cyber insurance policy for the franchise system. If Azal Coffee exercises this right, franchisees are required to pay a portion of the cost of the cyber insurance policy.
The specific portion of the cost that the franchisee must pay will be determined by Azal Coffee's policies and procedures. The method and frequency of collecting the franchisee's share of the cyber insurance policy costs will be outlined in Section 4.13 of the Franchise Agreement.
Section 4.13 states that payments to Azal Coffee for various fees and amounts owed must be made via electronic or similar funds transfer from the franchisee's bank account. These payments will be made at the times specified in the Agreement or as otherwise specified by Azal Coffee. Azal Coffee may require franchisees to make payments daily, weekly, or at some other interval, even if the agreement specifies a different payment schedule.