What is a 'Technology Fee' in the context of a Red Wagon Club franchise?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
d support for the Technology System. | | | Franchisee agrees to incur the costs of obtaining the computer hardware and software comprising the | | | Technology System (and any additions and modifications) and required service or support as Franchisor | | | may require and modify from time to time. | |[Signature Page to Follow]
FRANCHISEE:
Sign here if you are taking the franchise as an INDIVIDUAL(S)
(Note: use these blocks if you are an individual or a partnership but the partnership is not a separate legal entity)
| Franchisee may be required to license, and sign a software license agreement regarding, certain | |
|---|---|
| proprietary software as part of our requirements for the Technology System. Franchisor and its affiliates | |
| may charge Franchisee an initial and recurring fee for any proprietary software or technology that | |
| Franchisor or its affiliates license to Franchisee and for other maintenance, support, and technology | |
| development services that Franchisor or its affiliates provide (a “Technology Fee”). Franchisor reserves | |
| the right to increase the Technology Fee to reflect changes in the costs and availability of technology, | |
| provided that the Technology Fee may not be increased by more than $500 in any calendar month of the | |
| Term. |
Source: Item 23 — RECEIPTS (FDD pages 47–142)
What This Means (2024 FDD)
According to the 2024 Red Wagon Club Franchise Disclosure Document, a 'Technology Fee' covers the costs associated with the technology system required for operating a Red Wagon Club franchise. This fee encompasses charges for proprietary software or technology licensed to the franchisee by Red Wagon Club or its affiliates, as well as maintenance, support, and technology development services provided by them.
Prospective Red Wagon Club franchisees should be aware that this Technology Fee is not fixed. Red Wagon Club retains the right to increase the Technology Fee to accommodate changes in technology costs and availability. However, the increase is capped at $500 in any calendar month during the term of the franchise agreement. Additionally, franchisees may be required to pay for software and other technology obtained through Red Wagon Club from third-party providers.
The franchisee bears the responsibility for ensuring their technology system interfaces properly with Red Wagon Club's and any third party's computer systems, maintaining specified connection speeds, and handling all consequences of improper operation, maintenance, or upgrades. This includes the costs of obtaining the necessary computer hardware, software, and any required service or support, as mandated and modified by Red Wagon Club. The Technology System may also provide Red Wagon Club and its affiliates access to all information generated by the system, including price maintenance and customer data.