Where in the Cordova Franchise Agreement can I find the definition of 'Royalty Fee'?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
"Royalty and Activity Report" shall have the meaning defined and set forth in Article 5.B. of this Agreement.
"Royalty Fee" shall have the meaning defined and set forth in Article 5.B. of this Agreement.
"Scheduled Opening Date" means the day that occurs 180 days immediately following the Effective Date of this Agreement.
"Spouse" means the legal spouse of an Owner.
"Supplemental Royalty Fees" shall have the meaning defined and set forth in Article 5.B. of this Agreement.
"Supplemental Royalty Fee Due Date" shall have the meaning defined and set forth in Article 5.B. of this Agreement.
"Supplemental Training" shall have the meaning defined and set forth in Article 4.A. of this Agreement.
"Supplemental Training Fee" shall have the meaning defined and set forth in Article 4.A. of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 44–195)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, the definition of 'Royalty Fee' can be found in Article 5.B of the Franchise Agreement. Article 5.B also defines the 'Minimum Quarterly Royalty Fee Requirement'.
Specifically, Cordova franchisees are obligated to pay a continuing royalty fee, referred to as the "Royalty Fee," throughout the term of the agreement. This fee is calculated as 10% of the franchisee's monthly Gross Sales, which is termed the "Royalty Rate." This royalty payment is subject to minimum quarterly requirements, referred to as the "Minimum Quarterly Royalty Fee Requirement."
In addition to the standard royalty fee, Cordova franchisees may also be subject to a "Supplemental Royalty Fee." This fee is applicable on a calendar year quarterly basis. If the total Royalty Fees paid by the franchisee during a given quarter do not meet or exceed the Minimum Quarterly Royalty Fee Requirements for that quarter, the franchisee must pay the difference as a Supplemental Royalty Fee.