Does the Closet Storage Concepts Transfer Agreement reference a previous Franchise Agreement?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
7.3.2.4 Franchisee has provided Franchisor a copy of the executed purchase agreement relating to the proposed transfer with all supporting documents and schedules, including transferee's assumption of and agreement to discharge all of Franchisee's obligations under this Agreement;
7.3.2.6 The transferee has executed Franchisor's then-current Franchise Agreement, at Franchisor's option;
7.3.2.7 Franchisee or transferee has paid Franchisor a transfer fee equal to 50% of the then current Initial Franchise Fee, subject to a minimum of $24,750;
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, the Transfer Agreement does reference a previous Franchise Agreement. Specifically, the FDD outlines several conditions that must be met before a transfer of a Closet Storage Concepts franchise can be approved.
One key condition is that the existing franchisee must provide Closet Storage Concepts with a copy of the executed purchase agreement related to the proposed transfer. This agreement must include the transferee's assumption of all obligations under the original Franchise Agreement. This ensures that the new franchisee is legally bound to uphold the terms and conditions initially agreed upon.
Additionally, the transferee may be required to execute Closet Storage Concepts' then-current Franchise Agreement, at the franchisor's discretion. The franchisee or transferee also needs to pay a transfer fee equal to 50% of the then current Initial Franchise Fee, subject to a minimum of $24,750. These stipulations ensure that Closet Storage Concepts maintains control over who operates its franchises and that the brand standards are upheld.