Are Better Blend franchisees allowed to offset or deduct from payments owed to BBF?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
fees).
- (f) Application. BBF may apply any payment received from Franchisee to any obligation and in any order as BBF may determine, regardless of any designation by Franchisee.
- (g) Obligations Independent; No Set-Off. The obligations of Franchisee to pay to BBF any fees or amounts described in this Agreement are not dependent on BBF's performance and are independent covenants by Franchisee. Franchisee shall make all such payments without offset or deduction.
- (h) Taxes. Franchisee will be responsible for (and shall immediately remit to BBF upon demand) all sales taxes, use taxes, and other taxes imposed on the fees payable by Franchisee to BBF or its affiliates and on services or goods furnished to Franchisee by BBF or its affiliates, unless the tax is an income tax assessed on BBF or its affiliate for doing
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to the 2024 Better Blend Franchise Disclosure Document, franchisees are explicitly prohibited from offsetting or deducting any amounts owed to Better Blend. The agreement states that the franchisee's obligation to pay fees or amounts is an independent covenant, meaning it is not dependent on Better Blend's performance. This ensures that Better Blend receives all payments due without any reductions or disputes tied to other issues.
This provision is fairly standard in franchising, as it protects the franchisor's revenue stream and ensures consistent payments. Franchisees must make all payments without any deductions, regardless of any issues they may perceive with Better Blend's services or support. This clause underscores the importance of franchisees fulfilling their financial obligations as outlined in the franchise agreement.
If a Better Blend franchisee fails to make payments on time, they will incur a $100 late fee, along with interest on the unpaid amount at a rate of 18% per year (or the highest rate allowed by law). Additionally, Better Blend can apply any payment received from the franchisee to any obligation in any order it determines, irrespective of any designation made by the franchisee. This gives Better Blend significant control over how payments are allocated and reinforces the financial obligations of the franchisee.