If I sell my Chocolate Bash business, when is the transfer fee payable?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Our out-of-pocket | When billed | We may cure your non-compliance on | |
| costs and internal | your behalf (for example, if you do not | ||
| cost allocation, plus | have required insurance, we may purchase | ||
| 10% | insurance for you), and you will owe our | ||
| costs plus a 10% administrative fee. | |||
| When transfer | Payable if you sell your business. | ||
| occurs |
Source: Item 6 — OTHER FEES (FDD pages 9–13)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, the transfer fee is payable when the transfer occurs. The FDD specifies this under Item 6, which details various fees a franchisee might encounter.
This means that if you decide to sell your Chocolate Bash franchise, you are obligated to pay the transfer fee at the time the ownership of the business is officially transferred to the new owner. It is crucial to factor this fee into your financial planning when considering selling your franchise, as it will directly impact the proceeds you receive from the sale.
It is important to note that the FDD does not specify the exact amount of the transfer fee in this section. The amount of the transfer fee is listed as "An amount equal to royalty fees and marketing fund contributions for the lesser of (i) 2 years or (ii) the remaining weeks of the franchise term." Prospective franchisees should carefully review the full Item 6 and the franchise agreement to fully understand all transfer-related obligations.