What is the amount of the Management Fee charged by Hyper Kidz, and when is it due?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
| Fees (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Costs and Attorneys' Fees | Actual costs | On demand | If you default under your agreement, you must reimburse us for the expenses we incur (such as attorneys' fees) in enforcing or terminating your agreement. |
| Indemnification | Actual costs | On demand | You must reimburse us for the costs we incur if we are sued or held liable for claims that arise from your operation of the Franchised Business or for costs associated with defending claims that you used the Proprietary Marks in an unauthorized manner. |
| Repair, Maintenance, and Remodeling/ Redecorating | Actual costs | As incurred | Payable to approved suppliers. You must regularly clean and maintain your Hyper Kidz Business and its equipment according to our requirements. We may require you to remodel or redecorate your Hyper Kidz Business to meet our then current image for all Hyper Kidz Businesses. We will not require you to remodel or redecorate your Hyper Kidz Business more frequently than every five years. If you do not maintain your Hyper Kidz Business according to our standards, we may arrange for the necessary maintenance and you must reimburse our costs on demand. |
| Management Fee | 10% of Gross Sales, plus expenses | If incurred | We have the right to step in and manage your Franchised Business in certain situations, such as your death, disability or prolonged absence. |
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, a franchisee may incur a Management Fee of 10% of Gross Sales, plus expenses. This fee is charged if Hyper Kidz steps in to manage the Franchised Business.
The Management Fee is charged in specific situations, such as the franchisee's death, disability, or prolonged absence. This implies that the fee is not a standard, ongoing charge but rather a conditional fee that is only applied when Hyper Kidz assumes control of the business operations.
It is important for a prospective Hyper Kidz franchisee to understand the circumstances under which this Management Fee could be applied and to factor this potential cost into their financial planning. While the fee is not routinely charged, it represents a significant expense (10% of Gross Sales plus expenses) if the franchisee is unable to manage the business. Franchisees should clarify with Hyper Kidz what specific events would trigger the imposition of the management fee.