When are royalties and advertising contributions due for an Engineering For Kids franchise?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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.
Source: Item 23 — RECEIPTS (FDD pages 53–138)
What This Means (2025 FDD)
According to Engineering For Kids' 2025 Franchise Disclosure Document, royalty and advertising contributions are due when gross sales are generated and received. Specifically, the FDD states that the obligation to make full and timely payments of royalties and advertising contributions is absolute, unconditional, fully earned, and due upon the generation and receipt of gross sales.
The agreement emphasizes that franchisees cannot delay or withhold these payments for any reason. This includes potential claims against Engineering For Kids or any alleged non-performance by them. Franchisees are not allowed to put payments in escrow or offset them against any claims.
This policy ensures a consistent revenue stream for Engineering For Kids and adherence to the franchise agreement. Franchisees must maintain timely payments of all fees, including royalties and advertising contributions, regardless of any disputes or perceived issues with the franchisor's performance. This arrangement is fairly standard in the franchise industry, where consistent and timely payments are crucial for the franchisor's operational stability and brand management.