Is the Bang Cookies Royalty Fee refundable?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee shall not, on grounds of the alleged nonperformance, material breach, or default by Franchisor of this Agreement, any other agreement between Franchisor and Franchisee, or for any other reason, withhold any payment, fee, or any other amount payable by Franchise to Franchisor pursuant to this Agreement, including, without limitation, the payment of the Royalty Fee and Advertising Contributions, or any other payment obligation by Franchisee to Franchisor. Franchisee shall not have the right to offset or withhold any liquidated or unliquidated amount allegedly due to Franchisee from Franchisor against any payment, fee, or any other amount payable to Franchisor pursuant to this Agreement or any other payment obligation by Franchisee to Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
Based on the 2024 Franchise Disclosure Document, the Bang Cookies FDD does not explicitly state whether the royalty fee is refundable. However, the document includes a section specific to franchisees operating under North Dakota law, stating that refund and cancellation provisions will not apply to them, although this statement refers to the initial franchise fee, not the royalty fee.
Furthermore, the FDD states that franchisees do not have the right to offset payments, including royalty fees, due to any alleged nonperformance or breach by Bang Cookies. This suggests that withholding royalty payments as a form of refund or compensation is not permitted under the franchise agreement.
To determine whether the Bang Cookies royalty fee is refundable in specific circumstances, prospective franchisees should seek clarification from the franchisor. It would be prudent to inquire about the conditions, if any, under which a refund of royalty fees might be considered, and to have any such agreement documented in writing.