Where in the Red Wagon Club Franchise Agreement can I find information about the non-compliance fee?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
6.G). Franchisee acknowledges that this Section 6.E is not Franchisor's agreement to accept any payments after they are due or Franchisor's commitment to extend credit to Franchisee or finance the operation of Franchisee's RWC Business.
6.F. NON-COMPLIANCE FEE.
If Franchisee is in default of this Agreement, Franchisor may charge Franchisee a non-compliance fee in the amount of $500 per default per month. Franchisor may charge Franchisee for each month that such default rema
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2024 FDD)
According to Red Wagon Club's 2024 Franchise Disclosure Document, details regarding the non-compliance fee can be found within the Franchise Agreement itself. Specifically, Section 6.F addresses this fee. This section outlines the circumstances under which Red Wagon Club may charge a franchisee a non-compliance fee.
If a Red Wagon Club franchisee is in default of the Franchise Agreement, the franchisor has the right to impose a non-compliance fee. This fee amounts to $500 per default for each month the default remains unresolved. The fee is payable in the same manner as the Program Fee payments, ensuring a consistent payment process.
It's important to note that Red Wagon Club's decision to charge this non-compliance fee does not constitute a waiver of any other rights or remedies the franchisor may have under the Franchise Agreement. This means that in addition to the fee, Red Wagon Club can pursue other actions to address the default. This provision serves as both a deterrent against non-compliance and a mechanism for Red Wagon Club to recoup costs associated with managing franchisee defaults.