Is the Opening Extension Fee for an Extreme Art Studio refundable?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
ble on the first day of the month after signing this Franchise Agreement, and monthly thereafter within five days of the end of the calendar month.
- 3.5 OPENING EXTENSION FEE. If you fail to begin operations from your Approved Location within 12 months after signing this Franchise Agreement (or 12 months after signing the Extreme Art Rider for subsequent Extreme Art Studio Business(es)) if you agreed to operate Extreme Art Studio Business, you will pay us $1,000 per month ("Opening Extension Fee"), until either the applicable Extreme Art Studio Business is open or we terminate this Franchise Agreement. Failure to pay the Opening Extension Fee will be a non-cur
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, the Opening Extension Fee is nonrefundable. If a franchisee fails to begin operations from their approved location within 12 months of signing the Franchise Agreement (or 12 months after signing the Extreme Art Rider for subsequent Extreme Art Studio Businesses), they must pay Extreme Art Studio an Opening Extension Fee of $1,000 per month. This fee continues until the Extreme Art Studio Business opens or the Franchise Agreement is terminated.
Failure to pay the Opening Extension Fee constitutes a non-curable default, which may result in the termination of the Franchise Agreement or the Extreme Art Rider. This means Extreme Art Studio has the right to terminate the agreement immediately if the franchisee fails to pay the fee.
This policy is important for prospective franchisees to understand, as it highlights the financial consequences of delays in opening their Extreme Art Studio Business. Franchisees should carefully plan their launch timeline and ensure they have sufficient resources to meet the opening deadline to avoid incurring these nonrefundable fees and potential termination of their agreement.