To what extent are transfer fees collectable by Bumper Man?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
(ttt) "Transfer Fee" means the transfer fee Franchisee must pay to Franchisor as set forth in Section 16 and in an amount equal to 20% of the purchase price of the Bumper Business set forth in the asset purchase agreement between Franchisee and the transferee.
only if the conditions set forth in this Section 16(d), as may be amended by Franchisor from time to time, are met prior to or concurrently with the proposed effective date of the Transfer:
- (i) Franchisee and its Principals have paid all Continuing Service Fees and all other amounts owed to Franchisor and its Affiliates, submitted all required Reports and other statements and data and otherwise are in full compliance with this Agreement as of the date of Franchisee's request for approval of the Transfer and as of the effective date of the Transfer.
- (ii) The proposed transferee (and its direct and indirect owners): (1) have sufficient business experience, aptitude , assets and financial resources to operate the Bumper Busines
(ix) Franchisee acknowledges that transferee will remit a portion of the purchase price, as determined by Franchisor (but not to exceed 10% of the purchase price of the Bumper Business), to be held by Franchisor in a noninterest bearing account until Franchisee has satisfied all conditions for Transfer set forth in this Agreement and the Manual, including without limitation, transitioning each of Franchisee's Customer accounts to transferee following the effective date of the Transfer. Franchisor may setoff from such portion of the purchase price withheld by Franchisor any amounts owed by Franchisee to Franchisor pursuant to Section 16(d)(i).
(e) Effect of Franchisor's Consent. Any Transfer without Franchisor's consent constitutes an Event of Default rendering such Transfer void and of no effect.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to Bumper Man's 2025 Franchise Disclosure Document, a transfer fee is required when a franchisee transfers their Bumper Business to another party. The transfer fee is defined as 20% of the purchase price of the Bumper Business, as specified in the asset purchase agreement between the franchisee and the transferee. This fee is payable to Bumper Man.
Bumper Man also stipulates conditions that must be met before or during the transfer. These conditions include the franchisee being current on all payments and in full compliance with the Franchise Agreement. The proposed transferee must also meet Bumper Man's standards for franchisees, including demonstrating sufficient business experience, financial resources, and good character.
Furthermore, Bumper Man may withhold up to 10% of the purchase price in a noninterest-bearing account until the franchisee meets all transfer conditions, including transitioning customer accounts to the transferee. Bumper Man can also deduct any amounts owed by the franchisee from this portion of the purchase price. Any transfer conducted without Bumper Man's consent is considered an event of default, rendering the transfer void.