When is the Transfer/Assignment Fee under the Development Agreement payable to Cinnaholic?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer/Assignment Fee under Development Agreement | $5,000 plus expenses | Before the consummation of the transfer or sale | Payable when, and if, you transfer or sell the Development Agreement. There are other conditions to this transfer (See Item 17 of this Disclosure Document) |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the Transfer/Assignment Fee under the Development Agreement is payable before the consummation of the transfer or sale. The fee is $5,000 plus expenses. This fee is specifically for transferring or selling the Development Agreement itself.
It's important to note that this fee is only applicable if a franchisee decides to transfer or sell their Development Agreement rights to someone else. There are also other conditions to this transfer, as outlined in Item 17 of the FDD, which a prospective franchisee should carefully review to understand the full requirements and restrictions associated with transferring the Development Agreement.
This type of transfer fee is common in franchising, as it allows the franchisor to maintain control over who is granted development rights and to ensure that any new developer meets their standards. The fee itself likely covers Cinnaholic's administrative costs associated with reviewing and approving the transfer, as well as any potential lost revenue from the initial sale of the development rights.