Does the Crisp & Green FDD Item 6 specify any late payment penalties for overdue fees?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
enue is recognized.
You must sign and deliver to us the documents that we periodically require to authorize us to debit your business checking account automatically for the Royalty, National Marketing Fee, and other amounts due under the Franchise Agreement or any related agreement between us (or our affiliates) and you. If we institute an automatic debit program for the Franchised Restaurant, we will debit your account for the Royalty and other amounts on or after the Payment Day, based on the Gross Sales for the previous month. You must make the funds available for withdrawal by electronic transfer before each due date. In our automatic debit program, we may require you to procure, at your expense, overdraft protection for your business checking account in an amount that we specify. You must reimburse us for any "insufficient funds" charges and related expenses that we incur for any checks that we receive from you or your failure to maintain sufficient funds in your automatic debit account.
You will be required to participate in our gift card program, pursuant to which CRISP & GREEN® gift cards may be purchased and redeemed at any CRISP & GREEN® Restaurant. Accordingly, you will be required to sell CRISP & GREEN® gift cards at your Franchised Restaurant and to honor the redeemption of CRISP & GREEN® gift cards at your Franchised Restaurant irrespective of where the redeemed CRISP & GREEN® gift cards were purchased. We determine the policies and procedures relating to payments and reimbursements associated with our gift card program, and communicate such policies and procedures to you in the Operations Manual or in other written bulletins or communications. You will also be required to participate in our loyalty program pursuant to policies and procedures we determine and communicate to you in the Operations Manual or in other written bulletins or communications.
Corporate Restaurants are not required to pay Technology Fees but currently do pay Royalty Fees and the National Marketing Fee on the same basis as franchised Restaurants. Corporate Restaurants do not have a specific local advertising requirement, however they will make expenditures in local advertising programs as appropriate.
Source: Item 6 — OTHER FEES (FDD pages 15–22)
What This Means (2024 FDD)
According to the 2024 Crisp & Green Franchise Disclosure Document, Item 6 outlines various fees, their amounts, due dates, and related remarks. While it doesn't explicitly use the term "late payment penalties," it does address consequences for not maintaining sufficient funds for automatic debits and actions Crisp & Green may take to cure defaults, which could arise from late payments.
Specifically, if Crisp & Green institutes an automatic debit program, franchisees must ensure funds are available for withdrawal on or before the payment day. Franchisees are responsible for reimbursing Crisp & Green for any "insufficient funds" charges and related expenses resulting from rejected checks or insufficient funds in the automatic debit account. This functions as a penalty for failed payments.
Additionally, if a franchisee defaults on the Franchise Agreement, Crisp & Green may take action to cure the default. The franchisee is then responsible for reimbursing Crisp & Green's costs and expenses, including reasonable attorneys' fees, incurred as a result of the default and any enforcement or termination actions. This could include costs associated with collecting unpaid amounts. Therefore, while not labeled as "late payment penalties," these stipulations serve as financial repercussions for overdue or missed payments. A prospective franchisee should clarify with Crisp & Green what specific interest rates or late fees might apply for overdue payments beyond the insufficient funds charges and default-related expenses.