How is a 'Year' defined for a Caring Transitions franchise, and does it always coincide with a calendar year?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
d in this addendum.
THEREFORE, the parties hereby amend the Franchise Agreement as follows:
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- This addendum is an integral part of, and is incorporated into, the Franchise Agreement. Nevertheless, this addendum supersedes any inconsistent or conflicting provisions of the Franchise Agreement.
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- To make this addendum easier to read and understand, certain terms have been defined below and will be capitalized throughout the addendum. Capitalized terms that are not defined below may be defined in the section where they first appear. Capitalized terms used but not defined in this addendum are used as defined in the Franchise Agreement.
- (a) The "Commencement Date" is the first day of the first month following the month in which Franchisee or its Designated Individual completes the initial training program described in section 7.1 of the Franchise Agreement.
- (b) A "Year" is a one-year period beginning on the Commencement Date or the anniversary of the Commencement Date. The parties acknowledge that a "Year" as defined in this Addendum may not necessarily coincide with a calendar year. For example, a Year may be the period from April 1, 2024 through March 31, 2025, or from July 1, 2024 through June 30, 2025.
- (c) The "Rebate Period" begins on the Commencement Date and ends on the day before the fifth anniversary of the Commencement Date.
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- As an incentive for Franchisee to fully develop the Franchised Business and the Territory, if Franchisee attains:
- (a) at least $900,000 of cumulative Gross Receipts during the two-Year period after the Commencement Date, then Franchisor will rebate to Franchisee $10,000 of the Franchise Fee;
- (b) at least $1,600,000 of cumulative Gross Receipts during the three-Year period after the Commencement Date and qualified for a rebate under subparagraph (a), then Franchisor will rebate to Franchisee an addit
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, a 'Year' is defined as a one-year period that begins on the Commencement Date or the anniversary of the Commencement Date. The Commencement Date is the first day of the first month following the month in which the franchisee completes the initial training program.
Importantly, the FDD explicitly states that a 'Year' as defined in the addendum may not necessarily coincide with a calendar year. For example, a 'Year' could run from April 1, 2024, through March 31, 2025, or from July 1, 2024, through June 30, 2025. This definition is relevant because certain incentives, such as the rebate of a portion of the franchise fee, are tied to the franchisee's gross receipts during specific multi-year periods after the Commencement Date.
For a prospective Caring Transitions franchisee, this means that the performance metrics for earning back a portion of the franchise fee are not based on calendar years but rather on the anniversary of when their franchise began operating after training. Franchisees should keep careful track of their Commencement Date to accurately monitor their progress toward these goals. The rebate program offers franchisees the opportunity to earn back $10,000 of the franchise fee for meeting certain revenue goals within the first two years, an additional $10,000 for meeting goals within the first three years, and a final $10,000 for meeting goals within the first four years.