Is a Marble Slab Creamery franchisee required to pay all debts incurred in the operation of the restaurant?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.6 Franchisee will promptly pay all sums owing to Franchisor and its Affiliates.
In the event of termination for any default of Franchisee, such sums will include all damages, costs, and expenses, including reasonable attorneys' fees, incurred by Franchisor as a result of the default.
- 4.7 Any payment or report not actually received by Franchisor on or before the due date will be deemed overdue. If any payment is overdue, Franchisee will pay Franchisor, in addition to the overdue amount, interest on such amount from the date it was due until paid at the rate of one and one-half percent (1.5%) per month, or the maximum rate permitted by Applicable Law, whichever is less, calculated on a daily basis, and a late charge of $125 per week for each week during which such payment is not received by Franchisor. Entitlement to such interest and late charge will be in addition to any other remedies Franchisor may have.
- 12.2.3.10 Franchisee will remain liable for all of the obligations to Franchisor in connection with the Restaurant before the effective date of the transfer and will execute any and all instruments reasonably requested by Franchisor to evidence such liability;
Source: Item 22 — CONTRACTS (FDD page 101)
What This Means (2025 FDD)
According to Marble Slab Creamery's 2025 Franchise Disclosure Document, franchisees are responsible for paying all sums owed to the franchisor and its affiliates. This includes not only regular payments but also any damages, costs, and expenses, including reasonable attorneys' fees, that the franchisor incurs as a result of the franchisee's default. This obligation is clearly stated within the franchise agreement, emphasizing the financial responsibilities of the franchisee throughout the term and even after termination for any default.
Furthermore, if any payment is overdue, Marble Slab Creamery will charge interest on the overdue amount at a rate of 1.5% per month, or the maximum rate permitted by law, calculated daily, along with a late charge of $125 per week for each week the payment remains outstanding. This interest and late charge are in addition to any other remedies the franchisor may pursue. This provision highlights the importance of timely payments and the potential financial consequences of late payments.
In the event of a transfer of the franchise, the franchisee remains liable for all obligations to Marble Slab Creamery in connection with the restaurant before the effective date of the transfer. The franchisee must also execute any instruments reasonably requested by the franchisor to evidence this liability. This ensures that the franchisor is protected from any outstanding debts or obligations even after the franchise changes ownership. Therefore, a prospective franchisee should carefully consider these financial obligations and ensure they have sufficient capital and a solid business plan to meet these requirements.