When transferring an Engel & Volkers franchise through a securities offering, what additional financial responsibility does the franchisee have?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer Fee (See Note 1) | $2,500 administrative fee. $10,000 or such higher amount as is necessary to reimburse our reasonable costs, in the case of a securities offering. | Before or at transfer. | There are no other requirements. (See Note 14) |
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- You must pay this transfer fee to us when your franchise is sold or transferred. If the transfer is a securities offering you will also be responsible for annually reimbursing us for all costs associated with providing reporting information requested in connection with the security.
Source: Item 6 — OTHER FEES (FDD pages 22–30)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, a franchisee selling or transferring their franchise must pay a transfer fee. The standard administrative transfer fee is $2,500. However, if the transfer involves a securities offering, the franchisee is responsible for a $10,000 fee, or a higher amount if necessary, to cover Engel & Volkers' reasonable costs.
In addition to the transfer fee, if the transfer is executed through a securities offering, the franchisee is also responsible for reimbursing Engel & Volkers annually for all costs associated with providing reporting information requested in connection with the security. This means that beyond the initial transfer fee, the franchisee will have ongoing expenses related to compliance and reporting requirements linked to the securities offering.
This condition highlights the importance of understanding all potential costs associated with transferring an Engel & Volkers franchise, especially when considering a securities offering. Prospective franchisees should carefully evaluate the financial implications of such a transfer, including the administrative fee, potential reimbursement of Engel & Volkers' costs, and ongoing reporting expenses.