What happens if a Caring Transitions franchisee fails to pay their debts or taxes?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee's failure to do so shall constitute a breach of this agreement.
All taxes shall be paid directly to the taxing authorities prior to the delinquent date.
If Franchisee shall fail to pay any such obligations promptly as the debts to such parties become due, or if any taxes become delinquent, Franchisor, in addition to its other remedies provided in this agreement, may elect to pay any such obligation or delinquent tax on behalf of Franchisee, together with late charges, penalties and interest, if any, and Franchisee shall, upon demand, reimburse Franchisor for any sums so paid by Franchisor, together with interest at the rate of eighteen percent (18%) per annum, or the highest rate allowed by law, whichever is less, from the date of payment by Franchisor to the date of reimbursement by Franchisee.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 41–49)
What This Means (2025 FDD)
According to Caring Transitions's 2025 Franchise Disclosure Document, a franchisee's failure to pay debts or taxes constitutes a breach of the franchise agreement. Caring Transitions requires that all taxes be paid to the taxing authorities before they become delinquent.
If a Caring Transitions franchisee fails to pay their obligations or taxes promptly, Caring Transitions has the right to step in and pay the debt or delinquent tax on behalf of the franchisee. This includes any late charges, penalties, and interest that may have accrued.
The franchisee is then obligated to reimburse Caring Transitions for all sums paid, along with interest. The interest rate applied to the reimbursed amount will be 18% per annum, or the highest rate allowed by law, whichever is less. This interest accrues from the date Caring Transitions made the payment until the franchisee reimburses the amount.