When is the Bft Development Fee considered fully earned by the Franchisor?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
develops and commences operation of a replacement Studio in compliance with an applicable Franchise Agreement. If, during the Term, Developer transfers a Studio in accordance with the transferred Studio's Franchise Agreement, the transferred Studio shall continue to be counted in determining Developer's compliance with the Development Schedule so long as it continues to be operated as a Studio. If, at any time, the transferred Studio ceases to be operated as a Studio, it will not count toward satisfaction of the Development Schedule.
4. DEVELOPMENT FEE
Concurrently with the execution of this Agreement, Developer must pay to Fra
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the Development Fee is considered fully earned by Bft upon the execution of the Multi-Unit Agreement. This fee compensates Bft for lost development opportunities.
Importantly, the Development Fee is non-refundable under any circumstances. However, Bft will credit the Development Fee towards the Initial Franchise Fee due under the second and each subsequent Franchise Agreement signed under the Multi-Unit Agreement. These credits are applied in $10,000 increments until the total Development Fee is exhausted.
For a prospective Bft franchisee, this means that the Development Fee is paid upfront and is non-refundable, regardless of whether the franchisee successfully develops all the planned studio locations. While the fee is credited towards future franchise fees, it represents an immediate, non-recoverable cost. This is a common practice in multi-unit franchise agreements, as it secures the developer's commitment and compensates the franchisor for reserving a specific territory.