What is the maximum number of months for which a Deka Lash franchisee can pay a Delayed Opening Fee?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
dates by 6 months. Pursuant to COMAR 02.02.08.16L, the general release required as a condition of sale, or transfer, shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
- 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 territory when that territory is due. 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 and Transferability. If at any point you (a) do not pay your delayed opening fee, (b) stop or refute our ability to ACH this transaction, (c) notify us, in writing, that you no longer want to be charged the delayed opening fees, or (d) after a period of 12 months of paying t
Source: Item 12 — TERRITORY (FDD pages 40–44)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, a franchisee can pay a Delayed Opening Fee for up to 12 months. This fee is assessed if a franchisee is behind on their Development Schedule, excluding any extension obtained with a release. For each month the fee is paid, the development schedule for the unit rights is extended by one month. The Delayed Opening Fee is $500 for each territory when that territory is due.
However, the ability to pay this fee is contingent on the franchisee being current on their obligations to Deka Lash, in compliance with their franchise agreement, and demonstrating a good faith effort to secure and open their next scheduled studio. If these conditions are not met, the franchisee's territory and remaining development rights may be immediately terminated.
If a Deka Lash franchisee does not pay the delayed opening fee, stops the ACH payments, or notifies Deka Lash in writing that they no longer want to be charged the fees, or after paying the fee for 12 months, they will immediately lose their protected territory rights and transferability rights. Deka Lash also retains the right to approve the studio location. This policy provides a limited window for franchisees to catch up on their development schedule while maintaining their territory rights, but it also imposes strict conditions and consequences for non-compliance.