When are the ongoing royalty fees for a Petro Stopping Center payable?
Petro_Stopping_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
ees in the future based on a number of factors, including: (x) the number of prior extensions requested; (y) the number of franchised locations you have; and (z) situation-specific factors. The Opening Extension Fee is payable if and when we grant an opening extension.
OTHER FEES
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Ongoing Royalty Fees | You must pay us (i) 4.5% of all Non-QSR Gross Sales up to and including Six Hundred Thousand Dollars ($600,000) per month (the "Threshold Amount") and 2% of all Non QSR Gross Sales in excess of the Threshold Amount; (ii) 2% of all QSR Gross Sales; and (iii) $.007 on each gallon of Motor Fuel sold at your Petro Center1 | Payable monthly 10 business days following the Report Day by electronic funds transfer | Each calendar year the Threshold Amount will be increased by using the CPI Adjustment. You are not required to pay any Royalty under the Franchise Agreem |
Source: Item 6 — OTHER FEES (FDD pages 27–32)
What This Means (2025 FDD)
According to Petro Stopping Center's 2025 Franchise Disclosure Document, ongoing royalty fees are payable monthly, specifically 10 business days following the Report Day, and must be paid via electronic funds transfer. The royalty fees consist of (i) 4.5% of all Non-QSR Gross Sales up to and including Six Hundred Thousand Dollars ($600,000) per month (the "Threshold Amount") and 2% of all Non QSR Gross Sales in excess of the Threshold Amount; (ii) 2% of all QSR Gross Sales; and (iii) $.007 on each gallon of Motor Fuel sold at your Petro Center. The Threshold Amount is subject to an annual increase based on the CPI Adjustment.
It's important to note that Petro Stopping Center does not require franchisees to pay royalties on Gross Sales derived from a food concept operated under a separate franchise or license agreement with them or their affiliates, provided that the separate agreement already mandates royalty payments to Petro Stopping Center or its affiliates. This avoids double-dipping on royalty fees for co-branded operations within the Petro Stopping Center.
Understanding the nuances of 'Gross Sales,' 'Non-Fuel Gross Sales,' 'Non-QSR Gross Sales,' 'Motor Fuel Gross Sales,' and 'QSR Gross Sales' is crucial for accurately calculating royalty payments. These terms are specifically defined within the FDD to clarify what revenue streams are subject to the various royalty rates. Franchisees should carefully review these definitions to ensure compliance and avoid potential discrepancies in their royalty obligations.