What Franchise Agreement article dictates the fees a Crave Cookies franchisee must pay?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
hising's then-standard form) of any and all claims against Crave Cookies
Franchising, its affiliates, and their respective owners, officers, directors, agents and employees.
ARTICLE 4. FEES
- 4.1 Initial Franchise Fee. Upon signing this Agreement, Franchisee shall pay an initial franchise fee in the amount stated on the Summary Page. This initial franchise fee is not refundable.
- 4.2 Royalty Fee. Franchisee shall pay Crave Cookies Franchising a weekly royalty fee (the "Royalty Fee") equal to 6% of Gross Sales. The Royalty Fee for any given week is due on the first Tuesday of the following week.
4.3 Marketing Contributions.
- (a) Marketing Fund Contribution. Franchisee shall pay Crave Cookies Franchising a contribution to the Marketing Fund (the "Marketing Fund Contribution") equal to 2% of Franchisee's Gross Sales, at the same time as the Royalty Fee.
- 4.4 Replacement / Additional Training Fee. If Franchisee sends an employee to Crave Cookies Franchising's training program after opening, Crave Cookies Franchising may charge its then-current training fee. As of the date of this Agreement, the training fee is $250 per person, per day.
- 4.5 Non-Compliance Fee. If Franchisee does not comply with Crave Cookies Franchising's policies, procedures System, or this Agreement (other than Franchisee's non-payment of a fee owed to Crave Cookies Franchising), Franchisee will be subject to fines and charges as set forth in Crave Cookies Franchising's Brand Standards Manual. These fines and charges for non-compliance are due upon receipt. These fees are a reasonable estimate of Crave Cookies Franchising's internal cost of personnel time attributable to addressing the non-compliance, and it is not a penalty or estimate of all damages arising from Franchisee's breach. The non-compliance fees are in addition to all of Crave Cookies Franchising's other rights and remedies (including default and termination under Section 14.2). Detailed information is in Attachment 4 of this Agreement.
- 4.6 Reimbursement. Crave Cookies Franchising may (but is never obligated to) pay on Franchisee's behalf any amount that Franchisee owes to a supplier or other third party. If Crave Cookies Franchising does so or intends to do so, Franchisee shall pay such amount plus a 10% administrative charge to Crave Cookies Franchising within 15 days after invoice by Crave Cookies Franchising accompanied by reasonable documentation.
4.7 Payment Terms.
(a) Method of Payment. Franchisee shall pay the Royalty Fee, Marketing Fund Contribution, and any other amounts owed to Crave Cookies Franchising by pre-authorized bank draft or in such other manner as Crave Cookies Franchising may require. Franchisee shall comply with Crave Cookies Franchising's payment instructions.
- (b) Calculation of Fees. Franchisee shall report weekly Gross Sales, outside of Square, to Crave Cookies Franchising by Tuesday of the following week. If Franchisee fails to report weekly Gross Sales, then Crave Cookies Franchising may withdraw estimated Royalty Fees and Marketing Fund Contributions equal to 125% of the last Gross Sales reported to Crave Cookies Franchising, and the parties will true-up the actual fees after Franchisee reports Gross Sales. Franchisee acknowledges that Crave Cookies Franchising has the right to remotely access Franchisee's point-of-sale system to calculate Gross Sales.
- (c) Late Fees and Interest.
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 20–21)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, Article 4 of the Franchise Agreement outlines the fees that a franchisee must pay. This article covers several types of fees, including the initial franchise fee, royalty fees, and marketing contributions. It also discusses additional fees such as replacement training fees and non-compliance fees.
The initial franchise fee is paid upon signing the agreement and is non-refundable. The royalty fee is a weekly fee equal to 6% of gross sales. Franchisees must also contribute 2% of their gross sales to the Marketing Fund. These fees are crucial for Crave Cookies to maintain its brand standards, provide ongoing support, and conduct marketing activities.
Article 4 also details the payment terms, including methods of payment, late fees, and insufficient fund charges. Specifically, late payments incur a $100 late fee plus interest at 18% per year, and there is a $30 charge for any payment returned due to insufficient funds. Crave Cookies retains the right to apply payments to any obligation and in any order they determine, regardless of any designation by the franchisee. These terms ensure that Crave Cookies can effectively manage its financial relationship with its franchisees and maintain the financial health of the franchise system.