What is the procedure for paying the Initial Franchise Fee for an Alloy franchise?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
- A.
Initial Franchise Fee.
You must pay us an Initial Franchise Fee in the amount of set forth on the Data Sheet.
The Initial Franchise Fee is a lump sum payment and is due when you sign this Agreement.
The Initial Franchise Fee is earned upon receipt and, except as noted below, is nonrefundable.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, the initial franchise fee is a lump sum payment. The specific amount of the initial franchise fee is set forth on the Data Sheet. This fee is due when you sign the Franchise Agreement.
Once Alloy receives the initial franchise fee, it is considered earned and is generally nonrefundable, except as noted in the FDD. This means that once you pay the fee, Alloy is not obligated to return it to you, even if you do not open your franchise.
However, there is an exception for franchisees in South Dakota. Due to Alloy's financial condition, the South Dakota Securities Regulation Office requires a financial assurance. Therefore, if you are opening an Alloy franchise in South Dakota, all initial fees and payments are deferred until Alloy completes its pre-opening obligations under the Franchise Agreement.