What must a Crown Gold Exchange franchisee do if deficiencies are noted during an inspection?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
Without limiting Crown Gold Franchising's other rights under this Agreement, Franchisee will, as soon as reasonably practical, correct any deficiencies noted during an inspection.
If Crown Gold Franchising conducts an inspection because of a governmental report, customer complaint or other customer feedback, or a default or non-compliance with any System Standard by Franchisee (including following up a previous failed inspection), then Crown Gold Franchising may charge all out-of-pocket expenses plus its then-current inspection fee to Franchisee.
- 11.3 Crown Gold Franchising's Right to Cure. If Franchisee breaches or defaults under any provision of this Agreement, Crown Gold 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 Crown Gold Franchising for its costs and expenses (including the allocation of any internal costs) for such action, plus 10% as an administrative fee.
- 11.4 Right to Discontinue Supplies Upon Default. While Franchisee is in default or breach of this Agreement, Crown Gold Franchising may (i) require that Franchisee pay cash on delivery for products or services supplied by Crown Gold Franchising, (ii) stop selling or providing any products and services to Franchisee, and/or (iii) request any third-party vendors to not sell or
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, a franchisee must correct any deficiencies noted during an inspection as soon as reasonably practical. This requirement is part of the franchise agreement, and failure to meet minimum inspection scores can result in a default under the agreement.
Crown Gold Exchange has the right to inspect the premises of the business during normal business hours, and franchisees are expected to cooperate with these inspections. These inspections may include observing operations, conducting physical inventories, evaluating physical conditions, monitoring sales activity, speaking with employees and customers, and removing samples of products, supplies, and materials. Crown Gold Franchising may also videotape and/or take photographs of the inspection and the Business.
Furthermore, if an inspection is conducted due to a governmental report, customer complaint, or a default/non-compliance with system standards, Crown Gold Exchange may charge the franchisee for all out-of-pocket expenses plus the current inspection fee. Crown Gold Exchange also has the right, but not the obligation, to cure any default on behalf of the franchisee, with the franchisee responsible for reimbursing all costs and expenses, including a 10% administrative fee. While a franchisee is in default, Crown Gold Exchange can require cash on delivery for products/services, stop providing products/services, and/or request third-party vendors to not sell or provide products/services to the franchisee.