How often must an Engineering For Kids franchisee pay the Royalty fee?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
nt this clause, you agree to sign and deliver to us our current form of "Authorization Agreement for Prearranged Payments (Direct Debits)," a copy of which is attached to this Agreement as Appendix D, and you also agree to comply with the payment and reporting procedures we specify in the Manual (as defined in Section 11 of this Agreement).
- 3.5.1. You expressly acknowledge and agree that your obligation to make full and timely payment of Royalties and Advertising Contributions (and all other amounts provided for in this Agreement) is absolute, unconditional, fully earned, and due upon your generation and receipt of Gross Sales.
- 3.5.2. You agree that you will not, for any reason, delay or withhold the payment of all or any part of those or any other payments due hereunder, put payments in escrow or set-off same against any claims or alleged claims you may allege against us or others. You also agree that you will not, on grounds of any alleged non-performance by us or others, withhold payment of any fee, including without limitation Royalty fees or Advertising Contributions, nor withhold or delay submission of any reports due hereunder including but not limited to Sales Reports.
3.6. Technology Fee
You must pay us an ongoing monthly "Technology Fee" that we require, at such times and in such amounts as we may designate. The Technology Fee as of the Agreement Date is Two Hundred Dollars ($200) per month, but we reserve the right to increase this fee, provided that any increase will not exceed a monthly increase of Twenty-Five Dollars ($25) during any twelve (12) month period. You must pay the Technology Fee at the same time as, and in the same manner, as the Royalty fee pursuant to Sections 3.2 and 3.3 above, unless we otherwise specify in writing an alternative time and method of payment. We have the right to determine how and for what purposes the Technolog
Source: Item 23 — RECEIPTS (FDD pages 53–138)
What This Means (2025 FDD)
According to the 2025 Engineering For Kids FDD, franchisees must make full and timely payments of royalties based on their gross sales. The obligation to pay royalties is absolute, unconditional, fully earned, and due upon the generation and receipt of gross sales. This means that as soon as an Engineering For Kids franchisee generates revenue, the royalty payment obligation is triggered.
Engineering For Kids franchisees are not allowed to delay or withhold royalty payments for any reason. They cannot put payments in escrow or offset them against any claims they may have against the franchisor. Even if a franchisee alleges non-performance by Engineering For Kids, they are still obligated to pay the royalty fees and submit sales reports on time. This underscores the importance of maintaining consistent and timely payments, regardless of any disputes or issues that may arise.
In addition to the royalty fee, Engineering For Kids franchisees must also pay a monthly "Technology Fee." As of the agreement date, this fee is $200 per month, and Engineering For Kids reserves the right to increase it, but not by more than $25 in any 12-month period. The Technology Fee must be paid at the same time and in the same manner as the royalty fee, unless Engineering For Kids specifies otherwise in writing. This further emphasizes the regular financial obligations franchisees must meet to remain in good standing with the Engineering For Kids franchise system.