How long does a Desi District franchisee have to cure non-compliance before incurring a fee?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
fter opening, Desi District Franchise Group may charge its then-current training fee. As of the date of this Agreement, the training fee is $350 per day.
- 4.5 Non-Compliance Fee. Desi District Franchise Group may charge Franchisee $500 for any instance of non-compliance with the System Standards or this Agreement (other than Franchisee's non-payment of a fee owed to Desi District Franchise Group) which Franchisee fails to cure after 30 days' notice. Thereafter, Desi District Franchise Group may charge Franchisee $250 per week until Franchisee ceases such non-compliance. This fee is a reasonable estimate of Desi District Franchise Group's internal cost of personnel time attributable to addressing the non-compliance, and it is not a penalty or estimate of all damages arising from Franchisee's breach. Th
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, a franchisee has 30 days to cure non-compliance with System Standards or the Franchise Agreement before incurring a non-compliance fee. This fee is $500 for the initial instance of non-compliance.
Thereafter, if the franchisee fails to cease the non-compliance, Desi District may charge an additional $250 per week until the franchisee corrects the issue. The FDD states that these fees are a reasonable estimate of Desi District's internal costs related to addressing the non-compliance and are not considered a penalty.
It's important to note that this non-compliance fee is in addition to any other rights and remedies Desi District has, including default and termination rights as outlined in Section 14.2 of the Franchise Agreement. This means that while a franchisee has 30 days to cure the non-compliance to avoid the initial $500 fee, failure to cure could also lead to further financial penalties and even termination of the franchise agreement.