What is the minimum Monthly Minimum Royalty Fee Requirement during any Renewal Term for a Casiola franchise?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
During any Renewal Term, the Monthly Minimum Royalty Fee Requirement shall be not less than the Monthly Minimum Royalty Fee Requirement's applicable during the last calendar year of the initial Term and shall be subject to increase as determined by Franchisor provided that within each calendar year of any Renewal Term Franchisor shall not increase the Monthly Minimum Royalty Fee Requirement by more than 10% on an annual basis.
Source: Item 23 — RECEIPTS (FDD pages 47–209)
What This Means (2024 FDD)
According to the 2024 Casiola FDD, during any Renewal Term, the Monthly Minimum Royalty Fee Requirement will not be less than the requirement applicable during the last calendar year of the initial term. This means that if a franchisee chooses to renew their agreement, the baseline for their monthly minimum royalty fee will be whatever they were paying at the end of their initial term.
Casiola retains the right to increase this Monthly Minimum Royalty Fee Requirement during the renewal term. However, the FDD stipulates that Casiola can only increase the Monthly Minimum Royalty Fee Requirement by a maximum of 10% on an annual basis within each calendar year of the Renewal Term.
This provision provides some predictability for franchisees considering renewal, as they know the minimum royalty fee they will be subject to, and the maximum amount it can increase each year. However, franchisees should be aware that Casiola ultimately determines the amount of the increase, up to the 10% limit.