When is the Management Fee due for a Casa De Corazon franchise?
Casa_De_Corazon Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount (Note 1) | Due Date | Remarks |
|---|---|---|---|
| Management Fee | 5% of Gross Revenues, plus reimbursement of our out-of pocket expenses. | Upon demand | Only payable if we notify you of our intent to exercise our purchase option under the Franchise Agreement. |
| Type of Fee | Amount (Note 1) | Due Date | Remarks |
| Management Fee | 5% of Gross Revenues, plus reimbursement of our out-of pocket expenses. | Upon demand | Only payable if we notify you of our intent to exercise our purchase option under the Franchise Agreement. |
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Casa De Corazon's 2025 Franchise Disclosure Document, the Management Fee is 5% of Gross Revenues, plus reimbursement of out-of-pocket expenses. This fee is due 'Upon demand.' However, it's important to note that this fee is 'Only payable if we notify you of our intent to exercise our purchase option under the Franchise Agreement.'
In practical terms, this means a Casa De Corazon franchisee will only be required to pay the Management Fee if the franchisor decides to exercise its option to purchase the franchise. The fee covers 5% of the franchise's Gross Revenues, in addition to reimbursing the franchisor for any out-of-pocket expenses incurred during the management period.
Since the Management Fee is only applicable if Casa De Corazon exercises its purchase option, prospective franchisees should carefully review the terms and conditions related to this option in the Franchise Agreement. Understanding the circumstances under which the franchisor can exercise this option, and the implications for the franchisee, is crucial for making an informed investment decision.