What is the Crave Development Fee paid in consideration of?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
rated pursuant to a Franchise Agreement to be entered into between you and us in accordance with Section 3.1 hereof.
- 1.3 Except as otherwise provided in this Agreement, we shall not establish, nor franchise anyone other than you to establish, a dedicated Crave outlet in the Development Area during the term of this Agreement, provided you are not in default hereunder.
- 1.4 This Agreement is not a Franchise Agreement and does not grant to you any right to use the Marks or System.
- 1.5 You shall have no right under this Agreement to franchise others under the Marks or System.
SECTION 2 DEVELOPMENT FEE; INITIAL FRANCHISE FEES
- 2.1 In consideration of the Development Rights granted herein, you shall pay to us a development fee of ___________________________ Thousand Dollars ($____________), payable upon execution of this Agreement ("Development Fee"). The Development Fee is calculated as one hundred percent (100%) of the initial franchise fee for the first Franchised Business to be developed hereunder, plus a deposit equal to fifty percent (50%) of the initial franchise fee for each additional Franchised Business to be developed hereunder.
- 2.2 The Development Fee shall be fully earned by us upon execution of this Agreement, is not refundable, and will not be credited against any other fees you may pay to us pursuant to this Agreement or any Franchise Agreement.
- 2.3 The initial franchise fee payable for each Franchised Business to be developed hereunder shall be as follows:
- 2.3.1 For Restaurant outlets, the initial franchise fee shall be: Forty-Five Thousand Dollars ($45,000) for the first Restaurant, Forty Thousand Dollars ($40,000) for the second and third Restaurants, and Thirty Five Thousand Dollars ($35,000), for the fourth and each additional Restaurant.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the Development Fee is paid in consideration of the Development Rights granted to the franchisee. The amount of the Development Fee will be specified in the agreement. This fee is payable upon the execution of the Multi-Unit Development Agreement.
The Development Fee is calculated as 100% of the initial franchise fee for the first Crave Franchised Business to be developed, plus a deposit equal to 50% of the initial franchise fee for each additional Franchised Business to be developed under the agreement. For example, if a franchisee is planning to open three restaurants, the development fee would include the full franchise fee for the first restaurant plus half the franchise fee for the second and third restaurants.
The Development Fee is fully earned by Crave upon the execution of the agreement. It is non-refundable and will not be credited against any other fees the franchisee may owe to Crave under the Development Agreement or any Franchise Agreement. The initial franchise fee for the first Franchised Business is considered paid in full via a portion of the Development Fee. The franchisee must execute the Franchise Agreement for the first Franchised Business at the same time as they execute the Development Agreement, with a portion of the Development Fee satisfying the initial franchise fee for that first business.