Under what condition is the initial franchise fee waived for a Crisp & Green franchise?
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 the 2024 Crisp & Green Franchise Disclosure Document, the initial franchise fee is waived if the franchisee signs an Area Development Agreement. In this agreement, the franchisee is required to pay a Development Fee, the amount of which is detailed in the Rider to the agreement. This fee is paid in full when the agreement is signed.
The document specifies that the franchisee will not be required to pay an initial franchise fee for any of the franchised restaurants they develop under the Area Development Agreement. The franchisee must sign a Franchise Agreement for their first franchised restaurant concurrently with the Area Development Agreement, and a separate Franchise Agreement must be signed for each subsequent restaurant as it is identified, consistent with the Development Schedule.
It is important to note that the Development Fee is consideration for the Area Development Agreement itself and not for any individual Franchise Agreement. As such, the Development Fee is fully earned by Crisp & Green upon execution of the Area Development Agreement and is nonrefundable. If the franchisee fails to develop any franchised restaurants permitted under the agreement, they will not be entitled to any return or refund of the Development Fee.