Can a Kitchen Solvers franchisee withhold payment of amounts owed?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
In either case, you shall pay us (and to the appropriate governmental authority) such additional amounts as are necessary to provide us, after taking such taxes into account (including any additional taxes imposed on such additional amounts), with the same amount that we would have received or accrued had such withholding or other payment, whether by you or by us, not been required.
Source: Item 22 — Contracts (FDD page 49)
What This Means (2025 FDD)
Based on the 2025 Kitchen Solvers Franchise Disclosure Document, if any withholding or payment is required by the franchisee or Kitchen Solvers, the franchisee is responsible for paying additional amounts to ensure that Kitchen Solvers receives the full amount they would have received if the withholding or payment had not been required. This means a Kitchen Solvers franchisee cannot simply withhold payment of amounts owed. They must compensate Kitchen Solvers for any taxes or other deductions, so Kitchen Solvers receives the original owed amount.
This requirement ensures that Kitchen Solvers receives the full financial benefit of the franchise agreement, regardless of any tax implications or other required withholdings. It places the burden on the franchisee to cover any additional costs associated with these deductions. This is a fairly standard practice in franchising, where the franchisor aims to maintain a consistent revenue stream from each franchisee.
For a prospective Kitchen Solvers franchisee, this means they need to factor in potential tax implications and other withholdings when budgeting for franchise fees and other payments to Kitchen Solvers. They should consult with a tax advisor to understand the potential impact of these requirements on their financial obligations. Failing to comply with this provision could result in a breach of the franchise agreement and potential legal action from Kitchen Solvers.