What is the penalty for a Browns Chicken franchisee's failure to comply with specific operating standards?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
cts as described in Paragraph 10.D. of this Agreement and/or as set forth in the Operating Manual.
- E. Failure to Furnish Tax Returns. 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 furnish the tax returns set forth in Paragraph 12.B. by the stated deadlines.
- F. Failure to Comply with Specific Operating Standards. Franchisee shall pay Brown a penalty of One Hundred Dollars ($100) for each and every day, beginning with the first day up through and including the day the default is cured, that his Store fails to comply with the following specific Operating Standards, as set forth in this Agreement or in the Operating Manual, and of which Brown
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, a franchisee will incur a penalty for failing to comply with specific operating standards. The penalty is $100 per day for each day the store fails to comply with certain operating standards, beginning from the first day of non-compliance until the issue is resolved. Browns Chicken must provide at least fifteen days' notice to the franchisee before the penalty is imposed.
The specific operating standards that trigger this penalty include: all employees wearing required uniforms, using approved suppliers, complying with the insurance requirements outlined in Section 16 of the franchise agreement, and ensuring a manager trained to Browns Chicken's satisfaction is always present in the store.
It's important to note that the imposition of this daily penalty does not prevent Browns Chicken from pursuing other remedies available to them under the franchise agreement or applicable law. This means that in addition to the daily fine, Browns Chicken could take further action to address the franchisee's non-compliance. Franchisees should ensure they understand and adhere to all operating standards to avoid these penalties and potential further action from Browns Chicken.