When is the Development Fee payable to the Franchisor for a Jersey Mikes franchise development agreement?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
y.
- 1.4 This Agreement is not a Franchise Agreement, and Developer shall have no right to use in any manner the Marks by virtue of this Agreement.
- 1.5 Developer shall have no right under this Agreement to license or sublicense others to operate a business or use the System or the Marks.
2. DEVELOPMENT FEE
- 2.1 As consideration for the rights and options granted by this Agreement, Developer shall pay to Franchisor the Development Fee and the Initial Franchise Fee for each Restaurant as descri
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to Jersey Mikes' 2025 Franchise Disclosure Document, the Development Fee is payable to Jersey Mikes upon the execution of the Development Agreement. This fee serves as consideration for the rights and options granted to the developer under the agreement.
It is important to note that this Development Fee is fully earned by Jersey Mikes upon execution of the agreement and is non-refundable. This means that once the agreement is signed and the fee is paid, the developer will not receive a refund of the development fee under any circumstances.
In addition to the Development Fee, the developer is also responsible for paying the Initial Franchise Fee for each restaurant as outlined on the Summary Pages of the agreement. This Initial Franchise Fee is due upon approval of the site for each restaurant by Jersey Mikes, at which point a separate Franchise Agreement will be signed for that location. All payments must be made in United States Dollars.
Prospective Jersey Mikes developers should carefully review the Development Agreement and Summary Pages to understand the full scope of their financial obligations and the terms under which these fees are payable.