What is the 'Initial Module Fee' related to in the Extreme Art Studio Module Amendment?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
| 2. MODULE SELECTION AND INITIAL MODULE FEE . Franchisee wishes to add the services and offer the Module(s) through the Extreme Art Business in accordance with the terms of this Module Amendment. The Module(s) that Franchisee desires to add to the Extreme Art Business are as follows (check all that apply): | Craft Academy ($15,000 initial module fee) | Kidscientific ($20,000 initial module fee) | Little Hands Discovery ($10,000 initial module fee) | Total initial module fee: $ Franchisee shall pay the total initial module fee to Franchisor upon entering into this Module Amendment. Franchisee acknowledges and agrees that the initial module fee payment is not refundable under any circumstances.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to Extreme Art Studio's 2024 Franchise Disclosure Document, the Initial Module Fee is a one-time payment required when a franchisee chooses to add additional service modules to their existing Extreme Art Studio business. These modules offer additional services through the Extreme Art Studio business.
The FDD specifies three available modules: Craft Academy, Kidscientific, and Little Hands Discovery. The initial module fees are $15,000 for Craft Academy, $20,000 for Kidscientific, and $10,000 for Little Hands Discovery. The total initial module fee, which is the sum of the fees for the selected modules, must be paid to Extreme Art Studio upon entering into the Module Amendment.
The document explicitly states that the initial module fee is non-refundable under any circumstances. This means that if a franchisee decides to discontinue a module or if the module does not perform as expected, the initial fee will not be returned. This fee is separate from other fees associated with the franchise agreement, such as the initial franchise fee, royalty fees, and technology fees.