Are Brightstar Care franchisees required to pay a fee to transfer their franchise agreement?
Brightstar_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
rvices provide primarily training programs, operating manuals, assistance in site selection, and setting up franchisee records.
The contracts the Company enters contain several types of payments including:
- Initial Fees Franchise agreements require an initial fee up to $50,000 for the first 200,000 to 300,000 in population in the territory. If franchisees wish to purchase a territory with a population of less than 200,000, the initial fee is $25,000. If franchisees wish to purchase a territory with a population of over 300,000, the franchisees must pay the franchiser an additional $100 per additional 1,000 people in the territory above 300,000. Initial franchise fees are due and payable when a contract is signed and are not refundable.
- Royalty Fees The Company receives weekly royalty payments based on a percentage of each franchisee's prior month's net billings. The franchisee is required to meet a certain minimum revenue level for the payment of these royalty fees in any given month, effective two years after the opening date.
- General Marketing Fund Fees These fees are based on the greater of $500 per month or 2.5% of franchisee net billings to contribute to the local franchise and to the national brand advertising activities directed by the franchisor. These fees are typically due on a monthly basis over the course of the contract term.
- Monthly Technology Fees The Company receives monthly fees for the use of its Athena Business System technology software based on the greater of $250 per month or 0.83% of franchisee prior month's net billings.
- Renewal Fees Franchise agreements include renewal options and require the franchisee to pa
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 117)
What This Means (2025 FDD)
According to Brightstar Care's 2025 Franchise Disclosure Document, franchisees are required to pay a fee if they transfer their franchise agreement. The FDD specifies that franchise agreements include transfer options and that a transfer fee is required when these options are exercised. This fee is in addition to other fees such as initial fees, royalty fees, general marketing fund fees, monthly technology fees, and renewal fees.
For a prospective Brightstar Care franchisee, this means that if they decide to sell their franchise to another party, they will need to budget for a transfer fee. The exact amount of this fee is not specified in this excerpt, but it is a mandatory payment that must be considered when planning for a potential transfer. Franchisees should factor this cost into their long-term financial planning and exit strategy.
Transfer fees are a common practice in franchising, intended to cover the franchisor's costs associated with reviewing and approving the transfer, training the new franchisee, and updating records. The absence of a specified amount in this excerpt highlights the importance of carefully reviewing the full Franchise Agreement and discussing this fee with Brightstar Care during the due diligence process to fully understand the financial implications of transferring the franchise.