Is Chocolate Bash obligated to pay any amount that a Chocolate Bash franchisee owes to a supplier or other third party?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
- 4.9 Reimbursement. CB Franchising may (but is never obligated to) pay on Franchisee's behalf any amount that Franchisee owes to a supplier or other third party.
If CB Franchising does so or intends to do so, Franchisee shall pay such amount plus a 10% administrative charge to CB Franchising within 15 days after invoice by CB Franchising accompanied by reasonable documentation.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, Chocolate Bash is not obligated to pay any amount that a franchisee owes to a supplier or other third party. However, Chocolate Bash has the option to pay these amounts on the franchisee's behalf.
If Chocolate Bash chooses to pay a franchisee's debt to a supplier or third party, the franchisee is required to reimburse Chocolate Bash for the amount paid. In addition to the original amount, Chocolate Bash will also charge a 10% administrative fee. The franchisee must pay this total amount within 15 days of receiving an invoice from Chocolate Bash, which will include reasonable documentation of the payment.
This arrangement provides Chocolate Bash with the flexibility to assist franchisees in managing their financial obligations while ensuring they are promptly reimbursed for any payments made on the franchisee's behalf. The 10% administrative charge compensates Chocolate Bash for the costs associated with managing this payment process. Franchisees should be aware of this policy and ensure they can meet the reimbursement terms if Chocolate Bash chooses to exercise this option.