Does Crisp & Green require overdraft protection for the franchisee's business checking account?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
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.
Source: Item 6 — OTHER FEES (FDD pages 15–22)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, if Crisp & Green institutes an automatic debit program for royalty and other fees, they may require franchisees to procure overdraft protection for their business checking account at the franchisee's expense. The specific amount of overdraft protection required will be determined by Crisp & Green.
This means that as a Crisp & Green franchisee, you might need to set up overdraft protection on your business checking account to cover instances where your account balance is insufficient to cover the automatic debits for royalties and other fees. This is to ensure that Crisp & Green can collect the fees owed to them without issues.
Furthermore, franchisees are responsible for reimbursing Crisp & Green for any "insufficient funds" charges and related expenses incurred due to returned checks or failure to maintain sufficient funds in the automatic debit account. This highlights the importance of managing your account balance carefully to avoid these additional costs.