What is the definition of 'refuses to cooperate' with an audit or inspection?

According to Chocolate Bash's 2024 Franchise Disclosure Document, refusing to cooperate with an audit or inspection is grounds for breach of contract. Specifically, if a franchisee refuses to cooperate with or permit any audit or inspection by Chocolate Bash or its agents or contractors, or otherwise fails to comply with Section 10.5 or Section 11.2 of the agreement, it is considered a breach.

Section 10.5 gives Chocolate Bash the right to examine and audit all books and records related to the Chocolate Bash business, including supporting documentation, at any reasonable time. Chocolate Bash can conduct the audit at the business location or require the franchisee to deliver copies of books, records, and supporting documentation to a location designated by Chocolate Bash.

Section 11.2 allows Chocolate Bash to enter the premises of the Chocolate Bash business during normal business hours to conduct inspections. Franchisees must cooperate with Chocolate Bash's inspectors, and the inspection may include observing operations, conducting a physical inventory, evaluating physical conditions, monitoring sales activity, speaking with employees and customers, and removing samples of products, supplies, and materials. Chocolate Bash may also videotape and/or take photographs of the inspection and the business.

Therefore, a Chocolate Bash franchisee must allow Chocolate Bash access to their business premises, provide requested documentation, and generally cooperate with any audits or inspections conducted by Chocolate Bash to avoid being in breach of the franchise agreement.