Does the non-compliance fee limit Bombs Away Franchising's 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 may charge a franchisee $500 for any instance of non-compliance with the System Standards or the Franchise Agreement (excluding non-payment of fees) if the franchisee fails to correct the issue after 30 days' notice. After this initial period, Bombs Away can charge $250 per week until the franchisee resolves the non-compliance.
Bombs Away 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 imposition of this non-compliance fee does not prevent Bombs Away from pursuing other available rights and remedies, including actions for default and termination of the franchise agreement as outlined in Section 14.2 of the agreement. This means Bombs Away retains the ability to take further action beyond just levying the non-compliance fee.