What addendum must a Bft franchisee sign if they owe a sourcing fee for an additional franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
d to the broker, in lieu of the Initial Franchise Fee.
Additionally, if you are an existing franchisee and a franchise broker is owed a commission in connection with the purchase of your additional franchise(s) and/or Development Rights under a Multi-Unit Agreement based on a previously-made introduction to us or our affiliates, you will pay us an additional sourcing fee as follows: (i) if you acquire a single additional franchise, the sourcing fee will be $28,000 (in addition to the Initial Franchise Fee); (ii) if you acquire Development Rights under a Multi-Unit Agreement for the right to open two (2) additional Studios, then the sourcing fee will be $40,000 (in addition to your Development Fee); (iii) if you acquire Development Rights under a Multi-Unit Agreement for the right to open three (3) to five (5) Studios, then the sourcing fee will be $50,000 (in addition to your Development Fee); (iv) if you acquire Development Rights under a Multi-unit Agreement for the right to open six (6) to nine (9) Studios, then the sourcing fee will be $84,000 (in addition to your Development Fee); and (v) if you acquire Development Rights under a Multi-Unit Agreement for the right to open ten (10) or more Studios, then the sourcing fee will be $120,000 (in addition to your Development Fee). Any applicable sourcing fee will be due on the signing of your Franchise Agreement and/or Multi-Unit Agreement, will be fully earned upon payment, and will not be refundable under any circumstances. In this instance,
you will sign the Form of Sourcing Fee Addendum (Franchise Agreement), as attached as Exhibit L-1, and/or the Form of Sourcing Fee Addendum (Multi-Uni
Source: Item 5 — INITIAL FEES (FDD pages 18–21)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, if an existing franchisee owes a sourcing fee for an additional franchise or development rights under a Multi-Unit Agreement due to a previously-made introduction by a franchise broker to Bft or its affiliates, they must sign a specific addendum. The sourcing fee is applicable when a franchise broker is owed a commission in connection with the purchase of additional franchises.
The document specifies that in this instance, the franchisee will sign either the Form of Sourcing Fee Addendum (Franchise Agreement), attached as Exhibit L-1, or the Form of Sourcing Fee Addendum (Multi-Unit Agreement), attached as Exhibit L-2, depending on whether the sourcing fee relates to a single additional franchise or to development rights for multiple units. This addendum is signed in conjunction with the Franchise Agreement or Multi-Unit Agreement.
This requirement ensures that all parties acknowledge and agree to the terms of the sourcing fee arrangement. The sourcing fee is due upon signing the Franchise Agreement or Multi-Unit Agreement, is fully earned upon payment, and is non-refundable under any circumstances, so the addendum likely outlines these conditions to ensure the franchisee is fully aware of their obligations.