Does the transferee of a Belocal franchise have to pay an initial franchise fee?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
. The new franchise agreement shall supersede this Agreement in all respects, and its terms may differ from the terms of this Agreement, including higher fees, but the transferee shall not be required to pay an initial franchise fee. If the transferee is a corporation, partnership, limited liability company, or other entity, those of transferee's principals who are designated as principals by Franchisor must also execute such agreement and guarantee the performance thereof;
- (7) The transferor shall remain liable for all of its obligations to Franchisor under this Agreement incurred prior to the effective date of the transfer and must execute any and all instruments reasonably requested by Franchisor to evidence such liability;
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a transferee of a Belocal franchise is not required to pay an initial franchise fee. However, the new franchise agreement that the transferee enters into may have terms that differ from the original agreement, including potentially higher fees.
While the transferee is not required to pay the initial franchise fee, the transferor (the original franchisee) must pay Belocal a transfer fee upon application for consent to the transfer. This transfer fee is equal to the then-current initial franchise fee that Belocal generally charges to new franchisees, plus Belocal's reasonable attorneys' fees incurred in connection with the transfer.
It is important to note that the initial franchise fee is normally $735, but it may be waived under certain conditions. A prospective franchisee should carefully review the terms of the franchise agreement and discuss any potential fees or costs with Belocal before making a decision.