When is the initial franchise fee due for a Hyper Kidz franchise?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
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Franchise Agreement
Initial Franchise Fee: You must pay us an initial franchise fee of $42,500, which is due in a lump sum when you sign the Franchise Agreement. The initial franchise fee is imposed uniformly on all franchisees and is not refundable under any circumstances.
Training Fee: You must pay us a training fee equal to $7,500 when you schedule your trainees to attend our initial training program. We will train up to three people for the training fee. If you wish to send additional trainees to our initial training program, you must pay an additional training fee of $1,500 per person. You must also pay all expenses your trainees incur while attending training, including travel, lodging, meals and applicable wages. The training fee is not refundable.
Multi-Unit Development Agreement
Development Fee: If you sign a Multi-Unit Development Agreement, you must pay us a development fee. The development fee is payable to us in a lump sum when you sign the Multi-Unit Development Agreement and is not refundable under any circumstances.
Source: Item 5 — INITIAL FEES (FDD pages 9–10)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, the initial franchise fee of $42,500 is due in a lump sum when the Franchise Agreement is signed. This fee is applied uniformly to all franchisees and is non-refundable under any circumstances. For those signing a Multi-Unit Development Agreement, the timing of the initial franchise fee payment is slightly different.
Specifically, when a franchisee signs a Multi-Unit Development Agreement, they must pay a development fee. A portion of this development fee covers the initial franchise fee for the first Hyper Kidz Business. For each subsequent Hyper Kidz Business, a pro rata portion of the development fee is applied to the initial franchise fee. The remaining balance of $19,750 is then due when the franchisee signs the Franchise Agreement for each additional location.
It's important to note that Illinois residents may have an additional requirement. The Illinois Attorney General's Office may impose a surety bond requirement equal to the initial fee times the number of franchises to be sold, due to Hyper Kidz's financial condition. A prospective franchisee should consult with Hyper Kidz to determine if this requirement applies to them.