How are Non-Compliance fees calculated for a Deer Solution franchise?
Deer_Solution Franchise · 2025 FDDAnswer from 2025 FDD Document
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| Reporting Non-Compliance | $150 per occurrence | 14 days of invoice | Payable for failure to timely submit Royalty and Activity Reports, and other reports and financial statements as required under Franchise Agreement. |
|---|---|---|---|
| Operations Non-Compliance | $450 to $1,000 per occurrence | 14 days of invoice | Payable for failure to comply with operational standards as required and specified under Franchise Agreement, plus inspection and re- inspection costs incurred by us. |
| Payment Non-Compliance | $150 per occurrence | Payable for failure to timely pay, when due, a fee or payment due to us under the Franchise Agreement, plus interest, costs, and legal fees. | |
| Non-Compliance | Actual fees, costs, and expenses | On demand | Fees, costs, and expenses incurred by us as a result of your breach or non- compliance with the terms of your Franchise Agreement. |
| Legal Fees and Expenses | Costs and expenses | As incurred | This fee includes, but is not limited to, attorneys’ fees for any failure to pay amounts when due or failure to comply in any way with the Franchise Agreement. |
| Audit | Cost of audit | On demand | For costs incurred by us for each financial audit, provided the audit determines underreporting of 2% or greater during any designated audit period. Includes fees incurred by us including audit, legal, travel and reasonable accommodations. |
| Quality Assurance Audit | Actual costs incurred by us | As invoiced | Payable if we engage a third party to perform periodic quality assurance audits, including mystery shopper programs. |
| Management Service | 20% of Gross Sales, plus expenses | As invoiced | Payable if we elect to manage the Franchised Business due to death, disability, a failure by you to have the Franchised Business managed by an authorized Managing Owner or Manager, etc. |
| Collections | Actual fees, costs, and expenses | On demand | For costs and expenses incurred by us in collecting fees due to us, and/or to enforce the terms of the Franchise Agreement or a termination of the Franchise Agreement. Includes costs and expenses of re-inspections required by quality assurance audit. |
| NSF Check Fee of Failed Electronic Fund Transfer | $50 per violation or the maximum amount allowed by law, whichever is greater | As incurred | Payable if your bank account possesses insufficient funds and/or fails to process a payment or transfer related to a fee due from you to us. |
| Indemnification | Actual cost incurred by us | As incurred | The amount payable is the amount of any claim, liability, or loss we incur from your Franchised Business. |
| Post-Termination or | Costs and expenses | As incurred | The amount payable is the amount of |
| Post-Expiration | any claim, liability, or loss we incur | ||
| Expenses | from your Franchised Business. | ||
| Testing or Supplier Approval Fee | Actual fees, costs, and expenses | Within 14 days of invoice | You must pay us the costs incurred by us to review and evaluate a potential supplier, product, or service that you submit to us for approval. |
Source: Item 6 — OTHER FEES (FDD pages 14–19)
What This Means (2025 FDD)
According to Deer Solution's 2025 Franchise Disclosure Document, there are several categories of non-compliance that can trigger fees. Reporting Non-Compliance will incur a fee of $150 per occurrence, payable within 14 days of the invoice, for failing to submit Royalty and Activity Reports, and other required financial statements. Operations Non-Compliance ranges from $450 to $1,000 per occurrence, payable within 14 days of the invoice, for not meeting operational standards, and includes inspection and re-inspection costs. Payment Non-Compliance is $150 per occurrence for late payments, along with interest, costs, and legal fees.
General Non-Compliance fees are based on the actual costs and expenses Deer Solution incurs due to a franchisee's breach of the Franchise Agreement, payable on demand. Legal fees and expenses, also payable as incurred, cover attorneys’ fees for non-payment or any violation of the Franchise Agreement. An audit fee, covering the cost of the audit plus legal, travel, and accommodation expenses, is charged if an audit reveals underreporting of 2% or greater during any audit period, and is payable on demand.
Quality Assurance Audit fees are the actual costs Deer Solution incurs if they hire a third party for quality audits, including mystery shopper programs, and are payable as invoiced. There are also fees for NSF checks ($50 or the maximum allowed by law), indemnification (actual cost incurred), and post-termination or post-expiration expenses (costs and expenses incurred). These various non-compliance fees highlight the importance of adhering to the Franchise Agreement to avoid unexpected costs.