What is the non-compliance fee that My Salon Suite may charge for uncured defaults?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
nchisee fails to submit to Franchisor any required reports when due, including, without limitation, Gross Revenue reports required under Section 3.3 or financialstatements required under Section 11.B., Franchisor has the right, in addition to any other remedy available, to charge Franchisee (i) One Hundred Dollars ($100) per occurrence and (ii) a late fee of Fifty Dollars ($50) for each day such report is late, reduced, if necessary, to the extent such payment exceeds the amount permitted by applicable law. Franchisor may debit Franchisee's bank account for these amounts.
- I. Non-Compliance Fee. If Franchisee is in default of any provision of this Franchise Agreement and Franchisee fails to timely cure the default following Franchisor's notice to Franchisee, Franchisor may, at its option, elect to charge a non-compliance fee of two and one half percent (2.5%) of Franchisee's Gross Revenues, two percent (2%) of which payable to Franchisor in the same manner as the Royalty Fee and one half percent (0.5%) payable to the Brand Building Fund in the same manner as the Fund Contribution, until Fran
Source: Item 23 — RECEIPTS (FDD pages 95–230)
What This Means (2025 FDD)
According to My Salon Suite's 2025 Franchise Disclosure Document, if a franchisee defaults on any provision of the Franchise Agreement and fails to correct it after receiving notice from My Salon Suite, the franchisor has the option to charge a non-compliance fee. This fee is equivalent to 2.5% of the franchisee's Gross Revenues.
Of this 2.5%, 2% is payable to My Salon Suite in the same manner as the Royalty Fee, and 0.5% is payable to the Brand Building Fund, following the same payment method as the Fund Contribution. This non-compliance fee is in addition to any other fees or penalties that may apply under the Franchise Agreement.
My Salon Suite will provide written notice to the franchisee before imposing the non-compliance fee. Furthermore, even if a franchisee is paying the non-compliance fee, My Salon Suite retains the right to terminate the Franchise Agreement at any point if the franchisee does not resolve the default.