Are the DB Software and CR Software implementation fees for an Extreme Art Studio refundable?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
we may terminate this Franchise Agreement (or the Extreme Art Rider applicable thereto) upon such default. The Opening Extension Fees are nonrefundable.
- 3.6 IMPLEMENTATION FEES. Prior to opening each Extreme Art Studio Business, you must: (i) purchase a license for database management software ("DB Software") from third parties we designate; and (ii) pay us our then-current fee to implement the DB Software (currently $1,500). You must also pay us our then-current fee to implement your class registration software ("CR Software") (currently $500). These fees are separately payable for each Extreme Art Studio Busine
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to Extreme Art Studio's 2024 Franchise Disclosure Document, the implementation fees for both the DB Software and CR Software are nonrefundable. Prior to opening an Extreme Art Studio Business, franchisees must purchase a license for database management software (DB Software) from designated third parties and pay Extreme Art Studio a fee to implement the DB Software, which is currently $1,500. Franchisees must also pay Extreme Art Studio a fee to implement their class registration software (CR Software), which is currently $500.
These implementation fees are payable upon the execution of the Franchise Agreement (and each Extreme Art Rider applicable to such Extreme Art Studio Business) and are not refundable. This means that once the agreement is signed, the franchisee is obligated to pay these fees, and they will not be returned under any circumstances, even if the business does not open or the agreement is terminated.
This nonrefundable policy is a standard practice in franchising, as these fees often cover the franchisor's initial costs associated with setting up the franchisee's systems and providing initial support. Prospective Extreme Art Studio franchisees should factor these nonrefundable fees into their initial investment calculations and be certain of their commitment before signing the Franchise Agreement.