When are post-termination or post-expiration expenses due to Crawlspace Medic?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
| Amount | Due Date | Remarks | |
|---|---|---|---|
| Successor Fee9 Agreement | $1,500 | Upon signing a then current form franchise agreement | The Successor Agreement Fee is paid to us, over and above any Royalties, Brand Fund or any other fees to which we are entitled. |
| Indemnification10 | The amount of any claim, liability or loss we incur from your Franchised Business. | As incurred | Payable to us. |
| Reimbursement of Costs and Expenses11 | Costs and expenses. | As Incurred | Payable to us. |
| Management Fee | 10% of Gross Sales in the event we must operate franchise due to death, disability, etc. Plus our expenses | Weekly | Payable to us. |
| Post-Termination or Post-Expiration Expenses12 | Costs and expenses | As incurred | Reimbursement of our post termination or post-expiration expenses is paid to us. |
Source: Item 6 — OTHER FEES (FDD pages 10–16)
What This Means (2024 FDD)
According to Crawlspace Medic's 2024 Franchise Disclosure Document, franchisees are responsible for reimbursing post-termination or post-expiration expenses. These expenses, categorized as "costs and expenses," are due to Crawlspace Medic as they are incurred. This means that as Crawlspace Medic incurs costs related to the period after the franchise agreement ends or expires, the franchisee is obligated to promptly pay those expenses.
This arrangement places the financial burden of post-termination or post-expiration activities directly on the former franchisee. These costs could include expenses related to de-identifying the franchise location, transferring operations, or resolving any outstanding issues related to the terminated or expired franchise. The "as incurred" due date means Crawlspace Medic could demand immediate payment, potentially creating cash flow challenges for the former franchisee.
Franchisees should be aware of the potential financial implications of this clause. It is important to understand what types of expenses might be incurred post-termination or expiration and to factor those potential costs into their financial planning. It is also advisable to maintain detailed records and communication with Crawlspace Medic during the termination or expiration process to ensure transparency and avoid disputes over the legitimacy or amount of these expenses.