If Browns Chicken imposes a monetary penalty, does this limit their right to exercise other remedies?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
wn's financial or other individual interest. Examples of items that will promote or benefit all franchises and the System include but are not limited to enhancing the value of the Marks, improving customer service and satisfaction, improving product quality, improving uniformity, enhancing or encouraging modernization and improving the competitive position of the System.
24. MONETARY PENALTIES FOR NON-COMPLIANCE.
- A. If Franchisee commits any of the defaults described in this Section 24, Brown may impose monetary penalties on Franchisee, in addition to the other remedies set forth in this Section 24 and elsewhere in this Agreement. The imposition of a penalty in no manner limits Brown's right to exercise any other remedy available under this Agreement or in law. Brown will deposit any penalties paid, less its costs to collect them, into the Marketing Fund.
- B. Failure to Report Gross Sales and to Furnish Reports and Financial Statements. Franchisee shall pay Brown a penalty of One Hundred Dollars ($100) per day, beginning on the fifteenth (15th) day from the date performance is due, up through and including the day the default is cured, if he fails to report the Gross Sales of the Store, or to furnish the reports and financial statements, as set forth in Paragraph 12.B. by the stated d
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, the imposition of a monetary penalty does not limit their right to exercise other remedies. Browns Chicken retains the right to pursue any other remedy available under the Franchise Agreement or by law, even if a monetary penalty is imposed. Any penalties collected by Browns Chicken, after deducting the costs to collect them, will be deposited into the Marketing Fund.
Browns Chicken may impose a penalty of $100 per day if a franchisee fails to report gross sales or furnish required reports and financial statements by the stated deadlines, beginning 15 days after the due date until the default is corrected. A similar penalty of $100 per day applies if a franchisee defaults on royalty fee payments or Advertising Fund contributions, also starting 15 days after the due date.
This provision ensures that Browns Chicken has multiple avenues for addressing franchisee non-compliance, providing flexibility in enforcement. For a prospective franchisee, this means that being penalized financially for a violation does not preclude Browns Chicken from taking further action, such as demanding compliance, terminating the franchise agreement, or pursuing legal remedies. Franchisees should be aware of all the ways Browns Chicken can respond to a breach of contract.