For a Jack In The Box Hawaii Development Agreement, when is the Development Fee due?
Jack_In_The_Box Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the foregoing, in the State of Hawaii, Company will defer the payment of the Development Fee until all of the Company's pre-opening obligations to Developer have been satisfied and the Franchised Restaurant that you develop under this Agreement opens for business. Upon the opening of the Franchised Restaurant, Developer shall pay to Company the Development Fee.
Source: Item 22 — CONTRACTS (FDD page 94)
What This Means (2025 FDD)
According to the 2025 Jack In The Box FDD, for a Hawaii Development Agreement, the Development Fee is deferred until certain conditions are met. Specifically, Jack In The Box will defer the payment of the Development Fee until all of the company's pre-opening obligations to the Developer have been satisfied and the Franchised Restaurant opens for business.
Once the Franchised Restaurant opens, the Developer is then required to pay the Development Fee to Jack In The Box. This arrangement is outlined in the Hawaii Development Agreement Amendment (Multi-Unit) within the FDD.
This deferral of the Development Fee until the restaurant opening represents a significant benefit for franchisees in Hawaii, as it reduces the initial financial burden and aligns the payment with the commencement of business operations. It also provides assurance that Jack In The Box fulfills its pre-opening obligations before receiving the fee.