What is the deadline for paying the Deka Lash Development Fee?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
obligations owed to us, (b) in compliance with your franchise agreement(s) and (c) showing a good faith effort in trying secure and open your next scheduled studio, then the following will occur:
- a) Extension with Release (6 months). Per written notice to us and execution of a general release in our favor, we will grant you a one-time, six-month extension to your development schedule with no Delayed Opening Fee. This six-month extension can only be used once during your development agreement and delays all subsequent development dates by 6 months.
- b) Delayed Opening Fee Assessed (for up to 12 months). For each month you are behind on your Development Schedule (Extension with Release excluded), you will be charged a Delayed Opening Fee of $500 for each studio when that studio becomes due. For example, if you have 3 undeveloped units behind schedule, your Delayed Opening Fee will be $1,500 per month. This Development Schedule Extension Fee must be paid to us with our then-current royalty collections process. For each month this is paid, your development schedule for each of those unit rights will be extended by one month. We will allow you to pay a Delayed Opening Fee for up to 12 months.
- c) Loss of Protected Territory. If at any point you (a) do not pay your delayed opening fee, (b) stop or refu
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
The 2024 Deka Lash Franchise Disclosure Document does not specify a deadline for paying the Development Fee. However, it does state that if a franchisee is behind on their Development Schedule, they may be charged a Delayed Opening Fee of $500 per studio per month.
According to the FDD, Deka Lash allows franchisees to pay this Delayed Opening Fee for up to 12 months to extend their development schedule by one month for each month the fee is paid. However, if the franchisee does not pay the delayed opening fee, stops the ACH transaction, notifies Deka Lash in writing that they no longer want to be charged the fees, or after 12 months of paying the fee, the franchisee will immediately lose their protected territory rights.
Furthermore, the FDD states that if a franchisee is not current on their obligations, not in compliance with their Franchise or Development Agreements, or not showing a good faith effort to secure and open their next scheduled studio, their territory and remaining development rights will be immediately terminated. Since the FDD does not specify a deadline for the initial Development Fee, prospective franchisees should clarify the payment terms and schedule with Deka Lash directly before signing any agreements.