What costs must a Crab N Spice franchisee reimburse CNS Franchising for curing a default?
Crab_N_Spice Franchise · 2024 FDDAnswer from 2024 FDD Document
fault or non-compliance with any System Standard by Franchisee (including following up a previous failed inspection), then CNS Franchising may charge all outof-pocket expenses plus its then-current inspection fee to Franchisee.
- 11.3 CNS Franchising's Right to Cure. If Franchisee breaches or defaults under any provision of this Agreement, CNS Franchising may (but has no obligation to) take any action to cure the default on behalf of Franchisee, without any liability to Franchisee. Franchisee shall reimburse CNS Franchising for its costs and expenses (including the allocation of any internal costs) for such action, plus 10% as an administrative fee.
Source: Item 22 — CONTRACTS (FDD pages 50–51)
What This Means (2024 FDD)
According to Crab N Spice's 2024 Franchise Disclosure Document, if a franchisee defaults on any provision of the Franchise Agreement, CNS Franchising has the option to take action to correct the default on the franchisee's behalf, without incurring any liability.
In such instances, the franchisee is required to reimburse Crab N Spice for all costs and expenses incurred, including internal costs, associated with rectifying the default. In addition to the direct costs and expenses, Crab N Spice will also charge a 10% administrative fee.
Furthermore, if CNS Franchising conducts an inspection due to a governmental report, customer complaint, customer feedback, or a default or non-compliance with any System Standard by the franchisee, including following up on a previous failed inspection, Crab N Spice may charge the franchisee for all out-of-pocket expenses, as well as its then-current inspection fee.