What happens if a Caring Transitions franchisee defaults on any agreement during the Rebate Period?

According to Caring Transitions' 2025 Franchise Disclosure Document, if a franchisee defaults on any agreement or instrument with the franchisor during the Rebate Period, the Winner's Circle Program addendum becomes irrevocably null and void. This is in addition to any other remedies the franchisor may have under the Franchise Agreement, at law, or in equity. The Rebate Period begins on the Commencement Date and ends on the day before the fifth anniversary of the Commencement Date. The Commencement Date is the first day of the first month following the month in which the franchisee completes the initial training program.

This means that if a Caring Transitions franchisee fails to meet their obligations under any agreement with the franchisor during the five-year Rebate Period, they will lose all eligibility for rebates under the Winner's Circle Program. This could include failing to report Gross Receipts on time, not paying royalties, national branding fees, technology fees, or any other amounts due under the Franchise Agreement.

This strict compliance requirement underscores the importance of adhering to all terms of the franchise agreement and related documents. A prospective franchisee should carefully review all agreements and ensure they understand their obligations to avoid losing out on potential rebates. The franchisee must strictly and timely comply with all obligations under any agreement or instrument between Franchisee and Franchisor throughout the entire Rebate Period, including, by way of example, timely reporting Gross Receipts, timely paying all Royalties, National Branding Fees, Technology Fees, and other amounts due under the Franchise Agreement.

Furthermore, to be eligible to receive any rebates under this addendum, the franchisee must have attended all franchise system national conferences and regional conferences and all required on-site training centers, and execute a general release in a form prescribed by Franchisor prior to each rebate. If the Franchise Agreement is terminated for any reason prior to the end of its initial term, then Franchisee must return all rebates to Franchisor, if any.