What is the amount of the down payment required for a Christian Brothers Automotive franchise?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
You must pay CBAC an initial franchise fee of $135,000 (the "Franchise Fee"). This Franchise Fee is paid in two installments. The first installment is in the amount of $85,000 (the "Down Payment") and is due at the earlier of your signing the Franchise Agreement or your signing the Receipt and Acknowledgement Letter Agreement (the "Letter Agreement"), a copy of which is attached as Exhibit H. The second installment is in the amount of $50,000 and is due 30 days
prior to receiving your Certificate of Occupancy, which is generally assumed to be approximately six weeks prior to store opening. If you are allowed to finance the second installment, depending on your personal circumstances and credit worthiness, it will be paid to CBAC upon the closing of your startup loan, which is typically closed 30 days prior to receiving your Certificate of Occupancy as this coincides with initial working capital needs. $13,500 of the Down Payment will be fully earned when paid and non-refundable in consideration of administrative and other expenses CBAC incurs and for lost or deferred opportunities to enter into the Franchise Agreement with others.
Source: Item 5 — INITIAL FEES (FDD pages 14–17)
What This Means (2025 FDD)
According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, the initial franchise fee is $135,000, which is paid in two installments. The first installment, or down payment, is $85,000. This down payment is due upon signing the Franchise Agreement or the Receipt and Acknowledgement Letter Agreement, whichever comes first.
The second installment of the franchise fee is $50,000 and is due 30 days prior to receiving the Certificate of Occupancy, typically around six weeks before the store opens. Franchisees may be able to finance this second installment, depending on their financial situation and creditworthiness. If financed, the payment is made to Christian Brothers Automotive upon the closing of the startup loan, usually 30 days before the Certificate of Occupancy, coinciding with initial working capital needs.
It's important to note that $13,500 of the initial $85,000 down payment is considered fully earned by Christian Brothers Automotive upon payment and is non-refundable. This portion covers administrative and other expenses incurred by Christian Brothers Automotive, as well as lost or deferred opportunities to enter into franchise agreements with other potential franchisees. In certain termination scenarios, the entire down payment may be retained by Christian Brothers Automotive to cover costs, although there are some conditions under which a portion of the down payment may be refunded.