When is the full amount of the Baya Bar Development Fee due?

According to Baya Bar's 2024 Franchise Disclosure Document, the full amount of the Development Fee is due upon the developer's execution of the Multi-Unit Development Agreement. The Development Fee is considered fully earned at the time the agreement is signed and is non-refundable under any circumstances.

For a prospective Baya Bar multi-unit developer, this means that the entire Development Fee must be paid upfront when signing the agreement, regardless of when the individual franchise locations are actually developed and opened. This represents a significant initial investment and a financial commitment to develop multiple Baya Bar locations.

However, the agreement provides a credit towards the initial franchise fees for each Baya Bar outlet developed. Specifically, the developer will receive a $35,000 credit for the first outlet, a $15,000 credit for the second, and a $12,500 credit for each subsequent outlet. These credits are applied as payment towards the initial franchise fees due for each respective franchise agreement. This structure effectively uses the upfront Development Fee to offset a portion of the franchise fees as each location is developed, incentivizing the developer to proceed with the development schedule.

It is important for prospective developers to understand that the Development Fee is non-refundable, even if they do not ultimately develop all of the Baya Bar outlets outlined in the agreement. Therefore, careful consideration of the development schedule, market potential, and financial capabilities is crucial before entering into a Multi-Unit Development Agreement with Baya Bar.