When is the transfer fee payable to Cinch I.T. if I sell my franchise, and how much is it?
Cinch_I_T Franchise · 2024 FDDAnswer from 2024 FDD Document
| TYPE OF FEE1 | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| to client | must pay us for our time and any compensation (i.e., replacement product) given to clients. | ||
| Audits | Cost of audit plus interest on underpayment | As incurred | Payable only if audit shows understatement is willful or if 2% or more of gross sales for a two month period. |
| Interest | Interest on overdue payment | As incurred | Interest rate will be 1.5% per month or if the maximum interest rate permitted by state law is less, then interest will be charged at the lesser allowed rate. Interest begins from the date payment was due. |
| Late Fee | $100 per occurrence plus interest | On demand, but only if you are delinquent in your payments to us or otherwise violate an obligation under the Franchise Agreement | Payable the day after payment or other event (Ex: a required report) is due, in addition to the interest. |
| Transfer, Assignment | $10,000 | Time of transfer | Payable if you sell your franchise. No fee charged if you transfer franchise to a corporation or other entity you control. |
| Transfer Fee – Development Agreement | $5,000 for each unopened Franchise; $10,000 for each open and operating Franchised Business. | Time of transfer | Payable if Multi-Unit Developer sells its franchise. No fee charged if you transfer franchise to a corporation or other entity you control. |
| Multi-Unit Extension Fee – Development Agreement | $5,000 per extension | As incurred | Payable if Multi-Unit Developer desires to extend a Development Period. |
| Renewal | $5,000 | Time of renewal | New franchise agreement, which may |
Source: Item 6 — OTHER FEES (FDD pages 14–20)
What This Means (2024 FDD)
According to Cinch I.T.'s 2024 Franchise Disclosure Document, if you sell your franchise, you must pay a transfer fee of $10,000. This fee is due at the time of the transfer. However, if you transfer the franchise to a corporation or another entity that you control, you will not be charged this fee.
For a Multi-Unit Developer, the transfer fee differs. If a Multi-Unit Developer sells their franchise, the transfer fee is $5,000 for each unopened franchise and $10,000 for each open and operating franchised business. Similar to a standard franchise, this fee is payable at the time of the transfer. This fee is also waived if the transfer is to a corporation or other entity controlled by the Multi-Unit Developer.
It is important to note that all fees are uniformly imposed by and payable to Cinch I.T. or their designee and are payable through Electronic Funds Transfer (EFT). Franchisees must authorize their bank to accept automatic withdrawals for all fees through EFT.