Under what circumstances will a required payment or report be deemed delinquent by Chem Dry?

According to Chem Dry's 2024 Franchise Disclosure Document, a franchisee can be considered delinquent if they fail to provide complete and accurate reports or fail to pay amounts due to Chem Dry or its affiliates. However, Chem Dry must provide written notice of the failure, and the franchisee then has ten days to correct the failure. If the franchisee does not correct the failure within the ten-day period, it will be considered a breach of the agreement.

Specifically, the FDD states that if a Chem Dry franchisee fails to submit reports or other data, information, or supporting records when due, or fails to pay any amounts due to Chem Dry or its affiliates, on two or more separate occasions during any twelve-month period, it will be considered a breach of the agreement. This means that even if a franchisee eventually provides the required reports or makes the necessary payments, repeated late submissions or payments can still result in the franchisee being considered in default.

This policy highlights the importance of franchisees maintaining accurate records and adhering to payment schedules. Franchisees should ensure they understand the reporting requirements and payment deadlines outlined in the franchise agreement to avoid potential issues. It is also important to note that the franchisor's written notice is a prerequisite for considering the franchisee in default, providing an opportunity for the franchisee to rectify the situation before further action is taken.