What is the initial Non-Compliance Fee that Chocolate Fish Coffee may charge?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
late Fish Franchising's training program after opening, Chocolate Fish Franchising may charge its then-current training fee. As of the date of this Agreement, the training fee is $350 per day.
- 4.5 Non-Compliance Fee. Chocolate Fish Franchising may charge Franchisee $500 for any instance of non-compliance with the System Standards or this Agreement (other than Franchisee's non-payment of a fee owed to Chocolate Fish Franchising) which Franchisee fails to cure after 30 days' notice. Thereafter, Chocolate Fish Franchising may charge Franchisee $250 per week until Franchisee ceases such non-compliance. This fee is a reasonable estimate of Chocolate Fish Franchising's internal cost of personnel time attributable to addressing the non-compliance, and it is not a penalty or estimate of all dama
Source: Item 23 — RECEIPTS (FDD pages 41–119)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, if a franchisee fails to comply with the System Standards or the Franchise Agreement (excluding non-payment of fees) and does not correct the issue within 30 days of receiving notice, Chocolate Fish Coffee may charge an initial non-compliance fee of $500.
Furthermore, Chocolate Fish Coffee can charge an additional $250 per week until the franchisee rectifies the non-compliance. This fee is designed to cover Chocolate Fish Coffee's internal personnel costs associated with addressing the non-compliance and is not considered a penalty or a comprehensive estimate of all potential damages resulting from the breach.
It's important to note that this non-compliance fee is in addition to any other rights and remedies Chocolate Fish Coffee may have, including the possibility of default and termination of the Franchise Agreement as outlined in Section 14.2. This means that non-compliance can lead to both monetary penalties and more severe consequences, such as losing the franchise.