Is the transfer fee paid to Hawaiian Bros Island Grill refundable?
Hawaiian_Bros_Island_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
Outlet without Company's express prior permission; or
- (5) To operate a Special Outlet without Company's prior written permission.
- (b) Company reserves all rights that this Agreement does not expressly grant to or confer upon Franchisee.
3. FRANCHISE FEE
As partial consideration for the rights granted under this Agreement, Franchisee shall pay Company an initial franchise fee of $50,000 (the "Initial Franchise Fee"). The Initial Franchise Fee, less the amount of the Franchise Fee Deposit for the Franchised Resta
Source: Item 23 — RECEIPTS (FDD pages 77–262)
What This Means (2025 FDD)
According to the 2025 Hawaiian Bros Island Grill Franchise Disclosure Document, the initial franchise fee is generally not refundable. Specifically, the document states that as partial consideration for the rights granted under the agreement, the franchisee must pay an initial franchise fee of $50,000. This fee, less any Franchise Fee Deposit paid under the Development Agreement, is due upon execution of the agreement. The FDD explicitly states that the initial franchise fee is not refundable under any circumstances.
This means that a prospective Hawaiian Bros Island Grill franchisee should be aware that once the Franchise Agreement is signed and the initial franchise fee is paid, the franchisee cannot get this money back, regardless of any future circumstances. This is a standard practice in the franchise industry, as the initial fee covers the franchisor's costs for granting the franchise and providing initial support and training.
However, if the franchisee has signed a Development Agreement prior to the Franchise Agreement, a Franchise Fee Deposit may have been paid. This deposit is credited towards the initial franchise fee when the Franchise Agreement is signed. While the Franchise Fee Deposit itself is also non-refundable, it effectively reduces the amount of the initial franchise fee that needs to be paid at the time of signing the Franchise Agreement. Therefore, it is important for potential franchisees to understand the terms of both the Franchise Agreement and any prior Development Agreement to fully grasp the financial implications.