Updated September 27, 2020.

If you are considering a Young Rembrandts franchise, don’t get blindsided by these 18 important franchise fees (from the initial franchise fee, to the royalty fee, to 16 other fees found in Items 5 and 6 of Young Rembrandts’ 2020 FDD).

1.  Initial Franchise Fee:  $33,000 to $39,500

• For Young Rembrandts’ standard Gold Franchise, you pay an initial franchise fee of $39,500 by certified or cashier’s check when you sign the Agreement.

• In limited areas, Young Rembrandts will grant a Silver Franchise. If you are purchasing a Silver Franchise, you pay an initial franchise fee of $35,500 when you sign the Agreement.

• If you already own a franchise and are purchasing an additional franchise, you will pay an initial franchise fee of $33,000.

• Young Rembrandts offers a 10% discount on the initial franchise fee to veterans who qualify for its veterans discount program.

• If you fail to satisfactorily complete the Initial Training and Young Rembrandts terminates the Agreement for that reason, it will refund the initial franchise fee you paid less its expenses related to you (including the cost of recruiting, training, and providing materials) not to exceed 70% of the initial franchise fee, upon your delivery to it of a signed release. Otherwise, the fee is non-refundable.

2.  Territory Development Fee:  fee is determined by multiplying the number of additional franchises you will open by $16,500, which is one-half of the initial franchise fee for additional franchises

• You must sign one Franchise Agreement and pay the $39,500 initial franchise fee when you sign the Territory Development Agreement.

• Young Rembrandts charges a non-refundable Territory Development Fee which you must pay in a lump sum when you sign the Territory Development Agreement. The fee is determined by multiplying the number of additional franchises you will open by $16,500, which is one-half of the initial franchise fee for additional franchises.

• As you open each additional franchise, you must sign the then-current standard Franchise Agreement and pay $16,500 for the balance of the initial franchise fee.

3.  Royalty:  10% on first $75,000 in Gross Revenues and 8% on Gross Revenues in excess of $75,000 each year from September 1 through August 31

• For the Gold Franchise, you must pay a minimum monthly royalty of $250 for 1st and 2nd year, $400 for 3rd and 4th year, and $500 during years 5 through 10 and all renewal terms.

• For the Silver Franchise, you must pay a minimum monthly royalty of $250 for 1st and 2nd year, $300 for 3rd and 4th year, and $350 during years 5 through 10 and all renewal terms.

• Due Date:  On the 10th day of each month for all Gross Revenues received during the preceding calendar month.

• Obligation to pay royalty begins on the day you open for business.

• Obligation to pay the minimum monthly royalty begins the first full calendar month that is at least 30 days after the date you complete the initial training program; except in the case of transfers when the obligations begin upon the purchase of the franchise business.

• Gross Revenues means total receipts for services rendered by you, less applicable sales, use, or service taxes.

4.  National Marketing Fee:  up to 2% of Gross Revenues, currently 1% with a minimum of $35 per month; expected to increase in 2020 to 1.5% with a minimum of $40 per month

• Due Date:  On the 10th day of each month for the preceding calendar month.

• Obligation to pay the National Marketing Fee begins on the day you open your business.

• Obligation to pay the minimum monthly National Marketing Fee begins the first full calendar month that is at least 30 days after the date you complete the initial training program; except in the case of transfers when the obligations begin upon the purchase of the franchise business.

5.  Technology Fee:  currently $250 per year

• Due Date:  Upon billing.

• The fee is for covering Young Rembrandts’ costs for technology development and its costs for you to have access to and use certain technology tools, such as subscription fees and license fees.

6.  Late Fees:  10% of fees not paid on time, plus interest of highest legal rate or 1 1/2% if payment is more than 10 days late

• Due Date:  Upon billing.

• Payable if royalty, national marketing fees, or any other fees due to Young Rembrandts are not paid by the due date.

7.  Transfer Fee Plus Broker Fees:  $10,000, plus fee charged by broker, if applicable

• Due Date:  Before transfer.

• Transfer fee payable to Young Rembrandts when you sell your franchise.

• Covers initial training for the buyer.

• You must also pay any broker’s fees due on the sale.

• If your buyer completes training, but the sale to the buyer does not take place and you are responsible, you owe Young Rembrandts the current Additional Training Fee for the training it provided to your intended buyer.

8.  Renewal Fee:  $2,000

• Due Date:  Upon signing renewal Agreements.

• Payable to Young Rembrandts if you renew your franchise at the end of the initial term.

9.  Additional Initial Training:  currently $3,000 per trainee over 2 trainees for initial training and/or for trainees attending more than 2 years after you sign the Franchise Agreement

• Due Date:  Prior to training.

• Young Rembrandts provides initial training to the first 2 people trained within 2 years of signing the Franchise Agreement at no charge.

• You must also pay the expenses incurred by your employees in attending this training, including travel, room and board, and compensation.

10.  Annual Conference Fee:  Young Rembrandts determines the fee each year in advance. The fee is to defray Young Rembrandts’ costs for the conference. For 2020, estimated to be $600 to $800 per person.

• Due Date:  Before conference begins.

• You must attend the annual conference. If you fail to attend, you must still pay the conference fee. If Young Rembrandts does not hold the conference, you do not pay.

11.  Audit:  if the Royalty Fee has been underpaid by more than 3%, you pay Young Rembrandts 3 times the amount due, plus its cost of audit and other costs and 1 1/2% interest per month on the underpayment

• If you have underpaid by less than 3%, you pay Young Rembrandts the amount due plus its costs and 1 1/2% interest per month on the underpayment.

• Due Date:  Upon billing.

• Payable if audit of your books reveals a deficiency in your payments or if audit necessary due to your failure to report.

12.  Indemnification:  Young Rembrandts’ costs and damages

• Due Date:  When Young Rembrandts bills you.

• You must defend and indemnify Young Rembrandts from claims.

13.  Insurance Reimbursement:  Young Rembrandts’ cost

• Due Date:  Upon demand.

• If Young Rembrandts purchases insurance for you after you fail to do so.

14.  Attorneys’ Fees:  reasonable fees and costs

• Due Date:  When awarded by court.

• If Young Rembrandts must bring a suit or proceeding to enforce the Agreement.

15.  Cross Territory Fine:  $200 per class

• Due Date:  Upon demand.

• Payable for each class you conduct in another franchisee’s territory after the completion of the class session in progress at the time the new franchisee purchases the territory.

• Fine is in addition to Young Rembrandts’ right to terminate for breach.

16.  Supplier Approval Fee:  costs Young Rembrandts incurs in testing products and/or evaluating the supplier

• Due Date:  Upon demand.

• If you request approval of a supplier not currently approved, Young Rembrandts may charge you the costs it incurs in evaluating the supplier.

17.  National Accounts Administrative Fee:  costs Young Rembrandts incurs in handling administrations, billing, and/or collections for national accounts. Young Rembrandts is not currently charging this fee.

• Due Date:  Upon billing.

• Payable if you participate in the national accounts program and Young Rembrandts incurs costs in connection with handling administration, billing, and/or collection for any national account.

18.  Credit Card Processing Fee:  currently 3.4%, plus $0.30 per transaction. Fee subject to change.

• Due Date:  At time of payment by credit card.

• Credit card payments for fees owed to Young Rembrandts will be accepted in its discretion. It is not required to accept payment by credit card.