When is the Royalty Fee debited from the franchisee's account for a Caring Senior Service franchise?
Caring_Senior_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
Royalty Fee
You agree to pay us a non-refundable royalty ("Royalty Fee") equal to five percent (5%) of your Gross Billings or the Minimum Royalty Fee, whichever amount is higher, payable every two (2) weeks as described in subparagraph (c) below.
- (a) As used herein, the term "Minimum Royalty Fee" equals $150 for each two-week period in which Gross Billings are calculated during your first six months of operation and, afterwards, 5% of the applicable Gross Billings Target for each two-week period in which Gross Billings are calculated and as set forth in Section 9.3.
- (b) As used herein, the term "Gross Billings" means all amounts clients are obligated to pay in connection with the sale of products and services related to the Franchised Business (including all amounts invoiced to clients), regardless of collection, less any sales taxes or taxes collected by you from your clients for transmittal to the appropriate taxing authority and authorized discounts, plus business interruption insurance proceeds.
- (c) We will collect the Royalty Fee, and any other amounts due to us or our affiliate under this Agreement, by deducting such amounts from your operating account via electronic funds transfer on the second Friday following completion of the previous two (2) week period for which Gross Billings and Royalty Fees are calculated. In the event the Royalty due date is not a business day, we will debit your account on the next business day. You shall establish an arrangement for electronic funds transfer or deposit of any payments required under this Agreement. You shall execute our current form of "Authorization Agreement for Prearranged Payments (Direct Debits)," a copy of which is attached to this Agreement as
Exhibit H, or any other forms required by us, our bank and/or your bank, and you shall comply with the payment and reporting procedures specified by us in the Confidential Operations Manual.
Source: Item 23 — RECEIPTS (FDD pages 53–204)
What This Means (2025 FDD)
According to the 2025 Caring Senior Service Franchise Disclosure Document, the Royalty Fee, along with any other amounts owed to Caring Senior Service or its affiliates, is collected via electronic funds transfer from the franchisee's operating account. This deduction occurs on the second Friday following the completion of the two-week period for which Gross Billings and Royalty Fees are calculated.
If the due date for the Royalty Fee falls on a non-business day, Caring Senior Service will debit the franchisee's account on the next business day. Franchisees are required to establish an arrangement for electronic funds transfer to facilitate these payments, and they must complete Caring Senior Service's "Authorization Agreement for Prearranged Payments (Direct Debits)", which is included as an exhibit in the Franchise Agreement.
Furthermore, franchisees must ensure that sufficient funds are available in their account for these withdrawals. If Caring Senior Service is unable to access the franchisee's Gross Billings, or if the franchisee fails to report their Gross Billings, Caring Senior Service may debit the franchisee's account for 120% of the most recently debited Royalty Fee and Marketing Fees. Adjustments will be made in subsequent periods to reconcile any overages or shortages once the true Gross Billings are determined.