Where in the Casiola Franchise Agreement can I find the definition of 'Supplemental Royalty Fees'?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
Supplemental Royalty Fee: In addition to Franchisee's Royalty Fee obligations, on a calendar year quarterly basis throughout the Term of this Agreement, if the aggregate amount of the monthly Royalty Fees paid by Franchisee during the respective calendar year quarter do not, in aggregate, equal or exceed the aggregate amount of Franchisee's Monthly Minimum Royalty Fee Requirements (defined below) applicable to the months comprising the respective calendar year quarter (calculated by combining the Monthly Minimum Royalty Fee Requirement for each month within the applicable calendar year quarter), then Franchisee must pay to Franchisor the difference as a supplemental royalty fee (the "Supplemental Royalty Fee"). In calculating and determining the Supplemental Royalty Fee, the following Monthly Minimum Royalty Fee Requirements (the "Monthly Minimum Royalty Fee Requirements") shall be applicable and are imposed on Franchisee:
Source: Item 23 — RECEIPTS (FDD pages 47–209)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, the definition of 'Supplemental Royalty Fee' can be found within Article 5.B, which discusses Royalty Fees and Supplemental Royalty Fees. The document specifies that in addition to regular royalty fee obligations, a franchisee may be required to pay a 'Supplemental Royalty Fee' on a calendar year quarterly basis.
The 'Supplemental Royalty Fee' is applicable if the total monthly Royalty Fees paid during a calendar year quarter do not meet or exceed the aggregate of the Monthly Minimum Royalty Fee Requirements for that quarter. In such cases, the franchisee must pay Casiola the difference as a supplemental royalty fee.
The FDD also clarifies that the Monthly Minimum Royalty Fee Requirements are used in calculating the Supplemental Royalty Fee. Understanding these requirements is crucial for franchisees to anticipate potential supplemental fees and manage their financial obligations to Casiola effectively.