If Bombs Away Franchising cures a default, what is the franchisee's obligation regarding reimbursement for costs and expenses?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.3 Bombs Away Franchising's Right to Cure. If Franchisee breaches or defaults under any provision of this Agreement, Bombs Away Franchising may (but has no obligation to) take any action to cure the default on behalf of Franchisee, without any liability to Franchisee.
Franchisee shall reimburse Bombs Away Franchising for its costs and expenses (including the allocation of any internal costs) for such action, plus 10% as an administrative fee.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, if a franchisee defaults on any provision of the Franchise Agreement, Bombs Away Franchising has the option to take action to correct the default on the franchisee's behalf, without incurring any liability to the franchisee.
In such instances where Bombs Away chooses to cure a default, the franchisee is obligated to reimburse Bombs Away for all costs and expenses incurred. This reimbursement includes not only the direct costs but also an allocation of internal costs that Bombs Away may have incurred while addressing the default.
Furthermore, Bombs Away Franchising will add an additional 10% administrative fee to the total costs and expenses. This administrative fee is added to cover Bombs Away's administrative overhead for managing and resolving the franchisee's default.