When is the initial franchise fee for a Capriottis Sandwich Shop franchise due?
Capriottis_Sandwich_Shop Franchise · 2025 FDDAnswer from 2025 FDD Document
- The following language is added as the last paragraphs of Items 5 and 7 of the Franchise Disclosure Document:
Despite the payment provisions above, we will defer your payment of the initial franchise fee due under the Franchise Agreement until we have fulfilled all of our initial obligations to you under the Franchise Agreement and you have opened your Restaurant for business. You must pay us the initial franchise fee on the day you open your Restaurant for business.
Despite the payment provisions above, we will defer your payment of the development fee due under the Development Rights Agreement until we have fulfilled all of our initial obligations to you and you have opened your first CAPRIOTTI'S Restaurant for business. You must pay us the full development fee due under the Development Rights Agreement on the day you open your first CAPRIOTTI'S Restaurant for business.
Source: Item 5 — INITIAL FEES (FDD pages 12–13)
What This Means (2025 FDD)
According to the 2025 Capriottis Sandwich Shop Franchise Disclosure Document, the initial franchise fee is not due upon signing the Franchise Agreement. Instead, Capriottis Sandwich Shop defers the payment of the initial franchise fee until they have fulfilled all their initial obligations to the franchisee, and the franchisee has opened their restaurant for business.
Specifically, the franchisee must pay the initial franchise fee to Capriottis Sandwich Shop on the day the restaurant opens for business. This deferred payment structure is also applicable to the development fee under the Development Rights Agreement (DRA), where payment is deferred until the first Capriottis Sandwich Shop restaurant opens under the DRA.
This arrangement is beneficial for prospective Capriottis Sandwich Shop franchisees as it reduces the upfront financial burden. It also aligns the franchisor's interests with the franchisee's success, as Capriottis Sandwich Shop only receives the initial fee once the restaurant is operational. Franchisees should confirm that these deferral terms are reflected in their Franchise Agreement.