If you are considering a MOOYAH franchise, don’t get blindsided by these 19 important franchise fees (from the initial franchise fee, to the royalty fee, to 17 other fees found in Items 5 and 6 of MOOYAH’s 2017 FDD).
1. Initial Franchise Fee: $25,000 to $35,000
- When you sign a Franchise Agreement, you must pay MOOYAH an initial franchise fee (“Initial Franchise Fee”). If you sign a single Franchise Agreement, the Initial Franchise Fee is $35,000.
- If MOOYAH allows you to sign an Area Development Agreement, the Initial Franchise Fee for the 1st Franchise Agreement you sign pursuant to that Agreement is $35,000, but it is reduced to $25,000 for each subsequent Franchise Agreement you sign under that same Area Development Agreement.
- The Initial Franchise Fee is uniform for all franchisees and is earned by MOOYAH when you sign the Franchise Agreement.
- If MOOYAH elects to terminate the Franchise Agreement because you (or all of you, if more than one person signs the Franchise Agreement) fail to complete its initial training program to its satisfaction, it will refund ½ of the Initial Franchise Fee if you sign a confidentiality agreement and general release. Otherwise, the Initial Franchise Fee is not refundable.
2. Development Fee: the total number of Restaurants in the Minimum Performance Schedule (less the 1st one), multiplied by $25,000
- If and when you sign an Area Development Agreement, you must pay MOOYAH a development fee (“Development Fee”) equal to the product of (1) the total number of Restaurants in the Minimum Performance Schedule (less the 1st one), multiplied by (2) $25,000.
- The typical Area Development Agreement will have a Minimum Performance Schedule of 3 Restaurants. In that case, the Development Fee would be $50,000.
- As you sign the 2nd and each subsequent Franchise Agreement pursuant to the Area Development Agreement, MOOYAH credits the Development Fee, in $25,000 increments, toward the Initial Franchise Fee due under each such Franchise Agreement.
- The Development Fee is uniformly applied to persons entering into an Area Development Agreement, is fully earned by MOOYAH on your execution of the Area Development Agreement, and is non-refundable.
3. Royalty Fee: 6% of Gross Sales
- Due Date: Payable weekly.
4. Advertising Fee: 3% of Gross Sales
- Due Date: Payable weekly.
5. Extension Fee: $1,000
- Due Date: As incurred.
- Due only if you request, and MOOYAH grants, an extension of time to sign a lease for the Restaurant.
6. Audit: overdue amount, plus audit costs, plus an under-reporting fee equal to 100% of the overdue amount
- Due Date: 15 days after billing.
- Due only if the audit is triggered by your failure to submit required reports or you are found to have understated Gross Sales by more than 2%.
7. Interest: will vary
- Due Date: As incurred.
- If any amount is more than 1 week late, interest will accrue on the late payment at 10% of the past-due amount, but if the payment is late by 45 or more days, interest will accrue at a rate of the greater of 18% per annum or the highest rate permitted by applicable law.
8. Transfer Fee – Franchise Agreement: 50% of MOOYAH’s then-current Initial Franchise Fee
- Due Date: Submitted with transfer application.
9. Renewal Fee: 50% of MOOYAH’s then-current Initial Franchise Fee
- Due Date: Signing of renewal Franchise Agreement.
10. Transfer Fee – Multi-Unit Operator Agreement: $20,000
- Due Date: Submitted with transfer application.
11. Add-on Fee: $5,000
- Due Date: As incurred.
- Due only if MOOYAH allows you to add an individual as a Principal under the Franchise Agreement.
- MOOYAH may refund this fee if the added individual fails to complete its training program to its satisfaction and, as a result, is removed from the Franchise Agreement as a Principal.
12. MOOYAH Indemnification: will vary
- Due Date: When incurred by MOOYAH or other indemnified party.
- If claims covered by the indemnity obligations are asserted against MOOYAH and its related parties, you must defend and hold MOOYAH harmless against all liability, damages, and costs, including lawyers’ fees, incurred.
13. Operations Manual: $500, subject to change in the future
- Due Date: When you place order.
- Due if you lose and must replace your copy of MOOYAH’s Operations Manual.
14. Costs and Attorneys’ Fees: will vary
- Due Date: On demand.
- Due if you default under your Agreement, and MOOYAH incurs costs in enforcing or terminating it.
15. Gift Card Program: will vary
- Due Date: As incurred.
- You must participate in MOOYAH’s gift card program. Gift cards are available for sale and redemption at all Restaurants in the System.
16. New or Additional Employee Training: $1,000 to $2,000 per employee trained
- Due Date: On demand.
- Due if you request training for additional, new, or existing employees, or if MOOYAH requires you to take additional or refresher training programs.
17. Insurance Premiums: reimbursement of MOOYAH’s costs, plus 10% administrative fee
- Due Date: On demand.
- Due if you fail to procure the required insurance, and MOOYAH, at its option, elects to procure it on your behalf.
18. Management Fee: 3% of Gross Sales, plus expenses
- Due Date: As incurred.
- Due if MOOYAH elects to manage your Restaurant as permitted under the Franchise Agreement (for example, on your death, disability, or prolonged absence).
19. Liquidated Damages: will vary
- Due Date: Upon termination of the Franchise Agreement for your breach.
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