What administrative fee is required by Aplus for transfers among owners or transfers of non-controlling interest?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
n a general release in favor of Franchisor and in the form Franchisor requires; and (d) you pay to Franchisor a $1,500 administrative fee.
- 8.3. Transfer Among Owners; Transfer of Non-Controlling Interest. If you are a Business Entity, your Owners may transfer their ownership interests in the Business Entity among each other, and may transfer up to a Non-Controlling Interest in the Business Entity to one or more third parties, if: (a) you have provided to Franchisor advance notice of the transfer; (b) Attachment C to this Agreement has been amended to reflect the new ownership; (c) each new Owner has signed a Guaranty and Personal Undertaking in the form of Attachment D; (d) each previous and/or new Owner has sign
Source: Item 22 — CONTRACTS (FDD page 68)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if the franchisee is a business entity, the owners may transfer their ownership interests among each other, or transfer a non-controlling interest to a third party, provided certain conditions are met. A "Non-Controlling Interest" is defined as any interest less than 51% of the corporation, limited liability company, or partnership.
To complete such a transfer, Aplus requires that it receive advance notice of the transfer. Attachment C to the Development Agreement must be amended to reflect the new ownership. Each new owner must sign a Guaranty and Personal Undertaking in the form of Attachment D. Each previous and/or new owner must sign a general release in favor of Aplus, using the form Aplus requires.
Finally, the franchisee must pay Aplus an administrative fee of $2,500. This fee covers Aplus's administrative costs associated with processing the transfer and ensuring compliance with the franchise agreement. Prospective franchisees should consider this fee as part of their long-term financial planning, especially if they anticipate changes in ownership structure.