What is the name of the agreement attached as Exhibit H in the Christian Brothers Automotive FDD?
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.
Source: Item 5 — INITIAL FEES (FDD pages 14–17)
What This Means (2025 FDD)
According to the 2025 Christian Brothers Automotive Franchise Disclosure Document, Exhibit H is a copy of the Receipt and Acknowledgement Letter Agreement, also referred to as the "Letter Agreement". This agreement is signed at the same time as the Franchise Agreement, and it requires an initial down payment of $85,000 towards the total franchise fee of $135,000.
The Letter Agreement appears to be an important preliminary step in the franchise process. Christian Brothers Automotive will begin the process of identifying land for purchase within one year of the date of the Letter Agreement. If Christian Brothers Automotive fails to meet this deadline, the franchisee has a 30-day option to terminate the relationship and receive a refund of the down payment, minus a $13,500 non-refundable portion.
It is important for prospective franchisees to carefully review the Letter Agreement and understand its terms, especially regarding the conditions under which the down payment may be refunded. The Letter Agreement also outlines the franchisee's obligations and the franchisor's rights prior to the opening of the Christian Brothers Automotive franchise.