What condition triggers the payment of the development fee for a Floyds 99 franchise in Illinois?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
| ed, 20 | This Rider to the Development Agreement by and between Floyd's 99 Franchising, LLC and |
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Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, in the state of Illinois, the payment of the development fee is not due upon signing the agreement. Instead, the payment is deferred until Floyds 99 completes its initial obligations and the franchisee is open for business. This deferral is a requirement imposed by the Illinois Attorney General's Office, based on Floyds 99's financial statements.
This arrangement is more favorable for the franchisee compared to the standard practice of paying the development fee upfront. It reduces the initial financial burden and risk for the franchisee, as they only pay the fee once the business is ready to open. This also provides an incentive for Floyds 99 to promptly fulfill their initial obligations to get the franchisee operational.
However, prospective franchisees should confirm what Floyds 99's 'initial obligations' specifically include. Understanding these obligations is crucial for setting realistic expectations and timelines for opening the franchise. It is also important to note that Floyds 99 reserves the right to require the franchisee to pay up to $25,000 for an opening advertising and marketing campaign for the first shop and each subsequent shop that the Developer establishes.