How long does a Chocolate Bash franchisee have to cure non-compliance before a fee is charged?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
to the vendor. If CB Franchising 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 has 30 days to correct any non-compliance issues with the System Standards or the Franchise Agreement, excluding non-payment of fees owed to Chocolate Bash. If the franchisee fails to cure the non-compliance within this 30-day period after receiving notice, Chocolate Bash may impose a non-compliance fee.
The initial non-compliance fee is $500. If the non-compliance continues beyond the initial 30-day cure period, Chocolate Bash can charge an additional $250 per week until the franchisee rectifies the issue. This fee is designed to cover Chocolate Bash's internal costs related to addressing the non-compliance and is not considered a penalty or a comprehensive estimate of all potential damages resulting from the breach.
It is important to note that this non-compliance fee is in addition to any other rights and remedies Chocolate Bash may have, including default and termination of the Franchise Agreement. This means that Chocolate Bash could pursue other actions, such as terminating the agreement, even while charging the non-compliance fee. Prospective franchisees should understand the System Standards and Franchise Agreement thoroughly to avoid such fees and potential further actions from Chocolate Bash.