Is there an additional franchise fee to renew the franchise agreement with Carbones Pizzeria?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
The contract term for the initial franchise agreements is 10 years commencing on the earlier of the date when the restaurant opens or twelve months following the date the franchise agreement was signed. During that time, the franchisee is allowed to use the Carbone's Pizzeria name and menu. When the franchise agreement expires, the franchise may pay an additional franchise fee to renew the agreement. The contract term for franchise renewal agreements is 10 years. There were no initial and renewal franchise fees in the year ended October 31, 2024.
Source: Item 22 — CONTRACTS (FDD page 30)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, when the initial franchise agreement expires, a franchisee may need to pay an additional franchise fee to renew the agreement. The initial franchise agreement lasts for 10 years, starting either when the restaurant opens or twelve months after the franchise agreement is signed.
The renewal agreement also has a contract term of 10 years. This means that after the initial 10-year term, a franchisee can renew their agreement for another 10 years, subject to paying a renewal fee.
It is important to note that the FDD indicates there were no initial and renewal franchise fees in the year ended October 31, 2024. This likely refers to the accounting treatment of these fees, where they are recognized over the term of the agreement rather than upfront, and not necessarily that these fees are not charged. A prospective franchisee should confirm the current renewal fee amount and payment terms with Carbones Pizzeria.