What monetary obligations must a Desi District franchisee pay before transferring the franchise?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
en-current form of franchise agreement and any related documents, which form may contain materially different provisions than this Agreement (provided, however, that the proposed assignee will not be required to pay an initial franchise fee);
- (v) all owners of the proposed assignee provide a guaranty in accordance with Section 2.5;
- (vi) Franchisee has paid all monetary obligations to Desi District Franchise Group and its affiliates, and to any lessor, vendor, supplier, or lender to the Business, and
- Franchisee is not otherwise in def
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, a franchisee must meet certain monetary obligations before transferring their franchise. Desi District requires that the franchisee has paid all monetary obligations to Desi District and its affiliates, as well as to any lessor, vendor, supplier, or lender to the business.
In addition to ensuring all outstanding debts are settled, Desi District also requires a transfer fee. This fee is $10,000, and it is intended to cover any broker fees and other out-of-pocket costs incurred by Desi District during the transfer process.
These requirements ensure that the Desi District franchise system maintains financial stability and that any new franchisee is not burdened by the previous owner's debts. It is important to note that failure to meet these obligations could prevent the transfer from being approved by Desi District.