When is the Development Fee for a Crisp & Green development agreement payable?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
You must pay us a Development Fee in the amount set forth in the Rider. This fee is payable in full when you sign this Agreement. However, you will not be required to pay an initial franchise fee for any of the Franchised Restaurants you develop under this Agreement.
- A. You will sign the Franchise Agreement for your first Franchised Restaurant concurrently with this Agreement. A separate Franchise Agreement must be signed for each Franchised Restaurant as it is identified, which must be consistent with the Development Schedule. Upon the execution of each Franchise Agreement, the terms and conditions of the Franchise Agreement control the establishment and operation of the Franchised Restaurant.
- B. The Development Fee is consideration for this Agreement and not consideration for any Franchise Agreement, is fully earned by us upon execution of this Agreement, and is nonrefundable. If you fail or choose not to develop any Franchised Restaurant that is permitted under this Agreement, you will not be entitled to any return or refund of the Development Fee or any portion thereof.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, the Development Fee is payable in full when you sign the Development Agreement. The specific amount of the Development Fee is detailed in the Rider to the agreement.
This fee compensates Crisp & Green for granting the development rights and is not tied to any individual Franchise Agreement. This means that the franchisee must pay the entire Development Fee upfront to secure the rights to develop multiple Crisp & Green restaurants within the designated area.
It's important to note that the Development Fee is fully earned by Crisp & Green upon the execution of the Development Agreement and is nonrefundable. Therefore, if a franchisee fails to develop the number of restaurants outlined in the Development Schedule, they will not receive any portion of the Development Fee back. This highlights the importance of carefully assessing one's ability to meet the development obligations before signing the agreement and paying the fee.
Notably, while a Development Fee is required, the franchisee will not be required to pay an initial franchise fee for any of the Franchised Restaurants they develop under the Development Agreement. This could represent a significant savings as compared to signing individual franchise agreements for each location.