When is the latest a Punch King Fitness franchisee must pay their Cooperative Contribution each month?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
3. Franchisee is delinquent by more than ten (10) days in paying any sum due as required under this Agreement or any other agreement or instrument between Franchisor or Franchisor's affiliate and Franchisee.
4. Franchisee is late for more than 10 days on any payment due and owing to a Punch King Fitness approved or designated vendor or supplier.
5. Franchisee fails on two (2) or more separate occasions within any period of twelve (12) consecutive months to submit reports or other information or supporting records when due, Royalty Fees or other fees and payments when due to Franchisor or any Affiliate of Franchisor, or commits (3) defaults or more under this agreement or any other agreement with Franchisor or any Affiliate of Franchisor, whether or not such defaults or such failure to pay or submit information is corrected after notice thereof is delivered to Franchisee or after curing a default under this Agreement, Franchisee commits the same default again within six months of the default, even if Franchisee would otherwise be given an opportunity to cure the current default.
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to the 2024 Punch King Fitness FDD, the agreement specifies that if a franchisee is delinquent by more than ten days in paying any sum due, it constitutes a breach of the agreement. This includes any required Cooperative Contributions. Therefore, a Punch King Fitness franchisee must ensure that all payments, including Cooperative Contributions, are made within ten days of the due date to avoid being considered delinquent under the terms of the franchise agreement.
This requirement is significant because being delinquent in payments can lead to further penalties or even termination of the franchise agreement. Franchisees must maintain diligent financial management practices to ensure all fees and contributions are paid on time. This also extends to payments due to Punch King Fitness-approved vendors or suppliers, as being late for more than 10 days on these payments also constitutes a breach.
Furthermore, the FDD outlines additional scenarios where failure to meet financial obligations can result in default. For instance, if a franchisee fails to submit reports or remit Royalty Fees or other payments when due on two or more separate occasions within a 12-month period, it can be considered a default, regardless of whether the issues are corrected after notice. This underscores the importance of consistent and timely financial compliance for Punch King Fitness franchisees.