Is an Apricot Lane franchisee allowed to offset, credit, or deduct from the semi-monthly Royalty payment?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
For the use of the Marks and the System, FRANCHISEE shall pay FRANCHISOR, without offset, credit or deduction of any nature, during the term of this Agreement, a semi-monthly Royalty equal to five and one-half percent (5.5%) of the Gross Revenues (defined in Section 12.C below) derived from the Franchised Business at the times prescribed below or as otherwise provided in the Confidential Operations Manual (the "Royalty").
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to the 2025 Apricot Lane Franchise Disclosure Document, franchisees are required to pay royalties without any reductions. Specifically, Apricot Lane franchisees must pay a semi-monthly royalty fee, calculated as 5.5% of gross revenues, without any offset, credit, or deduction. This means that franchisees cannot subtract any expenses, credits, or other amounts from their royalty payments.
This requirement ensures that Apricot Lane receives the full royalty amount due, which is essential for supporting the franchise system. Franchisees need to factor this non-negotiable royalty payment into their financial planning and budgeting. Failure to comply with this provision could lead to penalties or even termination of the franchise agreement.
The stipulation that royalty payments are made "without offset, credit or deduction of any nature" is a fairly standard practice in franchising. It prevents disputes over deductions and ensures a consistent revenue stream for the franchisor. Prospective Apricot Lane franchisees should be aware of this condition and prepared to meet their royalty obligations in full and on time.