How frequently might Casiola require franchisees to make payments of financial obligations?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee agrees that under no circumstance is Franchisee entitled to withhold payments due to Franchisor under this Agreement. Among other things and without limitation to the foregoing, Franchisee expressly agrees that any claim by Franchisee as to the alleged non-performance of Franchisor's obligations shall not permit and/or entitle Franchisee to withhold payments due Franchisor under this Agreement.
- (1) If Franchisor previously instituted or, in the future, institutes an Advertising Cooperative that includes, in whole or in part, Franchisee's Operating Market or Franchisee's Casiola Business Location, Franchisee shall participate in and make such on-going financial contributions to the Advertising Cooperative, as determined by the Advertising Cooperative;
- (7) If the proposed Transfer includes or entails the Transfer of this Agreement, substantially all of the assets of the Franchised Business, a controlling interest in Franchisee, or is one of a series of Transfers which in the aggregate Transfers substantially all of the assets of the Franchised Business or a controlling interest in Franchisee, then, at the election of Franchisor and upon notice from Franchisor to Franchisee, the transferee may be required to execute (and/or, upon Franchisee's request, shall cause all interested parties to execute) for a term ending on the expiration date of the original Term of this Agreement, the then current standard form Franchise Agreement offered to new franchisees of Casiola Businesses and any other agreements as Franchisor requires.
Such agreements shall supersede this Agreement and its associated agreement in all respects, and the terms of Franchisor's then current agreements may differ from the terms in this Agreement, provided that such agreements shall provide for the same Royalty Fee, Advertising Contributions, and all other financial or monetary obligations established in this Agreement;
Source: Item 23 — RECEIPTS (FDD pages 47–209)
What This Means (2024 FDD)
According to the 2024 Casiola Franchise Disclosure Document, franchisees are not entitled to withhold payments due to Casiola under any circumstances. This includes situations where the franchisee claims Casiola is not fulfilling its obligations.
Casiola franchisees must make ongoing financial contributions to the Advertising Cooperative if one exists in their operating market. The amount and frequency of these contributions are determined by the Advertising Cooperative itself. However, the franchisee's contribution to the Advertising Cooperative will not exceed the local minimum marketing obligations outlined in Article 9.B of the franchise agreement.
In the event of a transfer of the franchise, the transferee may be required to execute Casiola's then-current standard form Franchise Agreement, which will stipulate the same Royalty Fee, Advertising Contributions, and all other financial or monetary obligations established in the original agreement. This ensures that financial obligations remain consistent even under new ownership.