If Buns On Fire manages my Franchised Business, what expenses will be charged to the account?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
- (viii.) enter the Franchised Business' premises and assume the management of the Franchised Business or appoint a third party (who may be our affiliate) to manage the Franchised Business. All funds from the operation of the Franchised Business while Franchisor or Franchisor's appointee assumes its management will be kept in a separate account, and all of the expenses of the Franchised Business will be charged to that account. Franchisor or Franchisor's appointee may charge you (in addition to the amounts due under this Agreement) a management fee equal to three percent (3%) of the Franchised Business' Gross Revenue during the period of management, plus any direct out-of-pocket costs and expenses. Franchisor or Franchisor's appointee has a duty to utilize only reasonable efforts and will not be liable to Franchisee for any debts, losses, or obligations the Franchised Business incurs, or to any of Franchisee's creditors for any products or services the Franchised Business purchases, while managing it. Franchisee shall not take any action or fail to take any action that would interfere with Franchisor or Franchisor's appointee's exclusive right to manage the Franchised Business and may, in Franchisor's sole discretion, be prohibited from visiting the Franchised Business so as to not interfere with its operations. Franchisor (or Franchisor's appointee's) management of the Franchised Business will continue for intervals lasting up to ninety (90) days each (and, in any event, for no more than a total of one year), and Franchisor will during each interval periodically evaluate whether Franchisee is capable of resuming the Franchised Business' operation and periodically discuss the Franchised Business' status with Franchisee.
Source: Item 23 — RECEIPTS (FDD pages 49–200)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, if Buns On Fire or its appointee assumes management of a franchised business, all funds from the operation will be kept in a separate account, and all expenses of the franchised business will be charged to that account.
In addition to the standard amounts due under the Franchise Agreement, Buns On Fire or its appointee may charge a management fee equal to three percent (3%) of the franchised business's Gross Revenue during the management period. They can also charge for any direct out-of-pocket costs and expenses incurred during the management period.
It is important to note that Buns On Fire or its appointee has a duty to utilize only reasonable efforts while managing the business and will not be liable for any debts, losses, or obligations the franchised business incurs during this time. The management of the franchised business by Buns On Fire will continue for intervals lasting up to ninety (90) days each, but for no more than a total of one year. During each interval, Buns On Fire will periodically evaluate whether the franchisee is capable of resuming the franchised business's operation and discuss the business's status with the franchisee.