What is the definition of 'Royalty Fee' for a Bee Organized franchise?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
ly Royalty Fee Requirement shall be not less than the Minimum Monthly Royalty Fee Requirement applicable during years 7 to 10 and shall be subject to increase as determined by Franchisor provided that within each calendar month of any renewal term we shall not increase the Minimum Monthly Royalty Fee Requirement by more than 10% per annum.
Payment and Due Date: The Royalty Fee shall be calculated on a monthly basis for each respective monthly Accounting Period. Royalty Fee payments shall be paid by Franchisee to Franchisor monthly by ACH, electronic funds transfer, or as otherwise designated by Franchisor and shall be due on the 5th of each monthly Accounting Period for the preceding month, and each month thereafter throughout the entire Term of this Agreement or, such other specific day of the month that Franchisor designates from time to time or for such other period that Franchisor may designate (the "Due Date").
Tax Obligations: If any federal, state or local tax, other than an income tax, is imposed on the Royalty Fee paid by Franchisee to Franchisor that, Franchisor cannot directly and, dollar for dollar, offset against taxes required to be paid by Franchisor under any applicable federal or state laws, Franchisee must compensate Franchisor in the manner prescribed by Franchisor so that the net amount or net rate received by Franchisor for the Royalty Fee is not less than that which has been established by this Agreement and which was due to Franchisor on the effective date of this Agreement. If any state imposes a sales or other tax on the Royalty Fees, then Franchisor shall have the right to charge and collect the tax from Franchisee.
Source: Item 23 — RECEIPTS (FDD pages 54–218)
What This Means (2025 FDD)
According to Bee Organized's 2025 Franchise Disclosure Document, the Royalty Fee is calculated monthly for each accounting period. Franchisees must pay the Royalty Fee to Bee Organized monthly via ACH, electronic funds transfer, or another method designated by the franchisor. The payment is due on the 5th of each month for the preceding month, or on another specific date designated by Bee Organized. This payment schedule continues throughout the entire term of the franchise agreement.
If any federal, state, or local tax (excluding income tax) is imposed on the Royalty Fee and Bee Organized cannot directly offset it against their own tax obligations, the franchisee must compensate Bee Organized. This ensures that Bee Organized receives the net amount or rate for the Royalty Fee as established in the franchise agreement. Bee Organized has the right to charge and collect sales or other taxes on the Royalty Fees from the franchisee if imposed by a state.
Additionally, upon the expiration or termination of the franchise agreement for any reason, the franchisee must immediately pay all outstanding sums and fees to Bee Organized. This includes, but is not limited to, Royalty Fees, advertising contributions, and any other amounts owed for products and services, such as system supplies. This obligation reinforces the importance of maintaining current payments and understanding the financial commitments throughout the franchise term.