Is the Prospect Generation Fee for Deka Lash franchises charged in addition to the Transfer Fee?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
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| Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Prospect | The actual cost | Prior to us giving | In the event you decide to sell |
| Generation | incurred by us, including commissions and fees charged by business brokers in cases where the buyer is identified through such broker. | consent to transfer your operating studio. | your operating studio to a prospective franchisee that comes from a lead generated through us (including broker networks, consultants, and referral sources used by us) you will be required to pay us a Prospect Generation Fee to reimburse us for our associated expenses before we will consent to the transfer of the operating studio to such a buyer. This fee is in addition to the Transfer Fee. |
| Fee | |||
| Legal Fees and Costs | Actual amount of attorney fees and costs incurred. | When incurred. | You must reimburse our attorney fees and costs for all expenses reasonably incurred (i) to enforce the terms of your Franchise Agreement or any obligation owed to us and our affiliates, whether or not we initiate the legal proceeding, unless we initiate and fail to substantially prevail in such court or formal legal proceeding; |
Source: Item 6 — OTHER FEES (FDD pages 15–23)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, the Prospect Generation Fee is charged in addition to the Transfer Fee. If a Deka Lash franchisee decides to sell their operating studio to a prospective franchisee that was initially a lead generated by Deka Lash (including through broker networks, consultants, and referral sources), the franchisee will be required to pay a Prospect Generation Fee.
The Prospect Generation Fee is designed to reimburse Deka Lash for expenses associated with generating the lead. This fee must be paid before Deka Lash will consent to the transfer of the operating studio to the buyer. The amount of the Prospect Generation Fee is the actual cost incurred by Deka Lash, including commissions and fees charged by business brokers if the buyer was identified through such a broker.
In addition to the Prospect Generation Fee, the franchisee must also pay a Transfer Fee. The Transfer Fee is $10,000 for a complete transfer or transfer of a majority interest in the franchise. This fee is due at the time of the transfer. The selling franchisee is responsible for all applicable broker fees related to the transfer. The transferee must be approved by Deka Lash and the franchisee must be in compliance with their Franchise Agreement.