What other agreement must be signed when signing a C3 Wellness Spa Multi-Unit Development Agreement?
C3_Wellness_Spa Franchise · 2024 FDDAnswer from 2024 FDD Document
For a Multi-Unit Development Agreement
Note 1: Development Area Fee and Franchise Fees – When you sign a Multi-Unit Development Agreement you must also sign a Franchise Agreement for the first Spa Location Franchise that you will be required to develop under your Multi-Unit Development Agreement. At the time of signing your Multi-Unit Development Agreement, in addition to paying the Franchise Fee for your first Spa Location Franchise, you must pay to us a Development Area Fee. The amount of the Development Area Fee varies depending on the number of additional Spa Location Franchises, over and above the first Spa Location Franchise authorized by the Franchise Agreement that you will sign with the Multi-Unit Development Agreement, that you will be authorized to develop and operate within the Development Area. The minimum number of Spa Location Franchises that you may be authorized to development is two and the maximum number is five. The Development Area Fee depends on the total number of Spas that you are authorized to develop under our Development Agreement and ranges from $40,000 for the second Spa that you are authorized to open to $35,000 for each Spa over and above the second Spa authorized by the Franchise Agreement that you will sign simultaneously with the Development Agreement)
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 21–25)
What This Means (2024 FDD)
According to the 2024 C3 Wellness Spa Franchise Disclosure Document, when signing a Multi-Unit Development Agreement, franchisees must also sign a Franchise Agreement for the first Spa Location Franchise that they are required to develop under the Multi-Unit Development Agreement. This means that the franchisee is committing to opening at least one C3 Wellness Spa location in addition to any additional locations covered by the development agreement.
At the time of signing the Multi-Unit Development Agreement, the franchisee is required to pay the Franchise Fee for their first Spa Location Franchise, as well as a Development Area Fee. The Development Area Fee varies depending on the number of additional Spa Location Franchises the franchisee will be authorized to develop and operate within the Development Area, over and above the first Spa Location Franchise authorized by the Franchise Agreement. The minimum number of Spa Location Franchises that a franchisee may be authorized to develop is two, and the maximum number is five.
The Development Area Fee depends on the total number of spas that the franchisee is authorized to develop under the Development Agreement. The fee ranges from $40,000 for the second spa to $35,000 for each spa over and above the second spa authorized by the Franchise Agreement that the franchisee is authorized to develop. This fee structure incentivizes franchisees to commit to developing more locations, as the per-spa fee decreases after the second location. Prospective franchisees should carefully consider their ability to manage multiple locations before committing to a Multi-Unit Development Agreement with C3 Wellness Spa.