Under what condition is the option fee payable for an Apricot Lane franchise?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks* |
|---|---|---|---|
| Royalty Payments | 5.5% of Gross Revenues(2) | Payable semi-monthly by the 20th and the 5th of each month. | Based on Gross Revenues for the preceding period of the 1st through the 15th for payments on the 20th, and the 16th through the last day of the month for payments on the 5th. |
| Option fee | $15,000 | Payable on signing the Location Option Agreement | Payable if you purchase an option (See Item 12) |
| Advertising and Development Fund (3) | 1% of your Gross Revenues | Payable to the Advertising and Development Fund in same manner as Royalty Fee listed above. | You also have to spend at least 2% of gross revenues on local advertising. See Item 11 for a detailed discussion about the Advertising and Development Fund. |
Source: Item 6 — OTHER FEES (FDD pages 11–14)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, the option fee is payable when a franchisee purchases an option. The fee is $15,000 and is due upon signing the Location Option Agreement. Item 12 of the FDD provides more information about the option.
This option fee is separate from other fees detailed in Item 6, such as the royalty payments, advertising fees, and transfer fees. The royalty payments are 5.5% of gross revenues, payable semi-monthly. Franchisees must also contribute 1% of their gross revenues to the Advertising and Development Fund, in addition to spending at least 2% of gross revenues on local advertising.
Prospective Apricot Lane franchisees should carefully review Item 12 to understand the terms and conditions of the Location Option Agreement before paying the $15,000 option fee. Understanding the details of the option, such as the period for which the option is valid and the conditions under which the fee is non-refundable, is crucial for making an informed investment decision.