What NOI must a Christian Brothers Automotive franchisee achieve by the end of the term of the Franchise Agreement?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
During the term of this Agreement, Franchisor shall provide Franchisee the opportunity to improve the performance of its Christian Brothers Automotive franchise in full compliance with the Minimum Performance Requirement in accordance with Section 4 hereof, thereby curing the Default. In the event Franchisee fails to fully comply with Section 4 hereof, this Agreement and the Franchise Agreement shall automatically terminate with no further notice to Franchisee, and Franchisor shall enforce its post termination contractual rights. In the event Franchisee fully complies with Section 4 hereof in all respects and timely meets the Minimum Performance Requirement, Franchisee shall be deemed to have cured the Default and the Franchise Agreement shall remain in full force and effect.
Source: Item 23 — RECEIPTS (FDD pages 76–372)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the excerpts provided do not specify a concrete Net Operating Income (NOI) target that a Christian Brothers Automotive franchisee must achieve by the end of the Franchise Agreement term. However, the document does refer to a "Minimum Performance Requirement" in Section 4, which franchisees must meet to avoid termination of the agreement.
While a specific NOI target is not mentioned, the FDD excerpts emphasize the importance of meeting the Minimum Performance Requirement. Failure to comply with Section 4 can lead to the automatic termination of the agreement, whereas full compliance ensures the agreement remains in effect. This suggests that the Minimum Performance Requirement is a critical benchmark for franchisees.
To fully understand the financial expectations, prospective Christian Brothers Automotive franchisees should ask the franchisor for details on how the Minimum Performance Requirement is defined, how it is calculated, and what specific financial metrics it includes. Understanding these metrics is essential for assessing the financial viability of the franchise and ensuring compliance with the Franchise Agreement.