What is the initial non-compliance fee for a Chocolate Bash franchisee?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
chising does so, it may impose a reasonable markup or charge for administering the payment program.
- 4.8 Non-Compliance Fee. CB Franchising may charge Franchisee $500 for any instance of non-compliance with the System Standards or this Agreement (other than Franchisee's nonpayment of a fee owed to CB Franchising) which Franchisee fails to cure after 30 days' notice. Thereafter, CB Franchising may charge Franchisee $250 per week until Franchisee ceases such non-compliance. This fee is a reasonable estimate of CB Franchising's internal cost of personnel time attributable to addressing the non-compliance, and it is not a penalty or estimate of all damages arising from Franchisee's breach. The non-compliance
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to the 2024 Chocolate Bash Franchise Disclosure Document, a franchisee may be charged an initial non-compliance fee of $500 for failing to adhere to the System Standards or the Franchise Agreement. This fee is applicable to instances of non-compliance that remain unresolved after a 30-day notice period. However, this fee does not apply to the nonpayment of fees owed to Chocolate Bash.
Following the initial fee, Chocolate Bash may impose an additional charge of $250 per week until the franchisee rectifies the non-compliance. This recurring fee continues as long as the franchisee remains in violation of the System Standards or the Franchise Agreement.
The FDD specifies that these non-compliance fees are designed to cover Chocolate Bash's internal costs related to addressing the non-compliance issues. It is explicitly stated that these fees are not intended as a penalty or a comprehensive estimate of all potential damages resulting from the franchisee's breach. Furthermore, the non-compliance fee is in addition to any other legal rights and remedies Chocolate Bash may pursue, including default and termination of the Franchise Agreement.