What payments must be made before a Hyper Kidz Business can be opened?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
- 7.9 In no event shall any Hyper Kidz Business be opened for business unless and until a Franchise Agreement for such Hyper Kidz Business has been fully executed, the initial franchise fee for such Hyper Kidz Business has been paid, and you have complied with all of the requirements under the Franchise Agreement for opening such Hyper Kidz Business.
The initial franchise fee for each Hyper Kidz Business to be developed hereunder shall be Thirty-Nine Thousand Five Hundred Dollars ($39,500).
We expect that you will execute the Franchise Agreement for the first Hyper Kidz Business to be developed hereunder contemporaneously with the execution of this Agreement and we will apply a portion of the Development Fee to satisfy in full the initial franchise fee for this first Hyper Kidz Business. For each additional Hyper Kidz Business you develop hereunder, when you execute the Franchise Agreement for that Hyper Kidz Business we will apply a pro rata portion of the Development Fee toward the initial franchise fee due for such Hyper Kidz Business and the balance of the initial franchise fee, or Nineteen Thousand Seven Hundred Fifty Dollars ($19,750), is payable in a lump sum upon execution of such Franchise Agreement.
9.2.7 If you open any Hyper Kidz Business for business before a Franchise Agreement for such Hyper Kidz Business has been fully executed.
3.1 Recognizing that time is of the essence, you agree to exercise each of the Development Rights granted hereunder in the manner specified herein, and to satisfy the Minimum Performance Schedule in a timely manner. Your failure to adhere to the Minimum Performance Schedule shall constitute a default under this Agreement as provided in Section 9.1. Under no circumstances, however, may you open a Hyper Kidz Business for business unless and until there is a fully executed Franchise Agreement in place for such Hyper Kidz Business and you have complied with all requirements under the Franchise Agreement for opening such Hyper Kidz Business.
Source: Item 23 — RECEIPTS (FDD pages 52–205)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, before a Hyper Kidz Business can be opened, a franchisee must ensure that a Franchise Agreement has been fully executed and the initial franchise fee has been paid. For a single unit franchise, the initial franchise fee is $39,500. For franchisees who sign a Development Agreement, a portion of the Development Fee will be applied to satisfy the initial franchise fee for the first Hyper Kidz Business. For each additional Hyper Kidz Business developed under the Development Agreement, a pro rata portion of the Development Fee will be applied toward the initial franchise fee, with the balance of $19,750 payable upon execution of the Franchise Agreement.
Hyper Kidz requires that all obligations under the Franchise Agreement for opening the Hyper Kidz Business are met. Section 3.1 of the agreement states that under no circumstances may a franchisee open a Hyper Kidz Business until a fully executed Franchise Agreement is in place. Section 9.2.7 states that Hyper Kidz may terminate the agreement if a franchisee opens a Hyper Kidz Business before a Franchise Agreement for such Hyper Kidz Business has been fully executed.
These requirements ensure that Hyper Kidz franchisees are in full compliance with the franchise agreement and have met all financial obligations before commencing operations. This protects both the franchisee and the franchisor by establishing a clear understanding of the financial and contractual commitments involved in opening a Hyper Kidz Business. Prospective franchisees should carefully review the Franchise Agreement and related documents to fully understand all requirements for opening a Hyper Kidz Business.