Does the non-compliance fee from Bombs Away Franchising affect other rights and remedies?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
may charge its then-current training fee. As of the date of this Agreement, the training fee is $350 per day.
- 4.5 Non-Compliance Fee. Bombs Away Franchising may charge Franchisee $500 for any instance of non-compliance with the System Standards or this Agreement (other than Franchisee's non-payment of a fee owed to Bombs Away Franchising) which Franchisee fails to cure after 30 days' notice. Thereafter, Bombs Away Franchising may charge Franchisee $250 per week until Franchisee ceases such non-compliance. This fee is a reasonable estimate of Bombs Away Franchising's internal cost of personnel time attributable to addressing the non-compliance, and it is not a penalty or estimate of all damages arising from Franchisee's breach. The non-compl
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, the non-compliance fee does not limit Bombs Away Franchising's other rights and remedies. Bombs Away Franchising may charge a franchisee $500 for any instance of non-compliance with the System Standards or the Franchise Agreement (excluding non-payment of fees owed to Bombs Away Franchising) if the franchisee fails to correct the issue after 30 days' notice. After this initial fee, Bombs Away Franchising can charge $250 per week until the franchisee resolves the non-compliance.
Bombs Away Franchising states that this fee is designed to cover the internal costs associated with addressing the non-compliance and is not considered a penalty or a comprehensive estimate of all potential damages resulting from the franchisee's breach.
Importantly, the non-compliance fee is explicitly stated to be in addition to all other rights and remedies available to Bombs Away Franchising. These other rights and remedies include default and termination of the agreement as described in Section 14.2 of the agreement. This means that Bombs Away Franchising can pursue other actions, such as terminating the franchise agreement, even while charging the non-compliance fee.