What is the consideration acknowledged in the Epcon Communities Market Hold Agreement?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
ding its decision on whether to enter into a Franchise Agreement and Market Area Agreement with Franchisor to develop a Project at a location within the Reserved Market Area, and Franchisor has agreed to grant to Franchisee such reservation for such Reserved Market Area. Franchisee may only, at Franchisor's sole discretion, obtain a reservation or "hold" on one proposed Market Area for each active Market Area that has a Project currently under development.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
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- Franchisee shall have paid to Franchisor no later than the time of Franchisee's execution of this Market Hol
Source: Item 23 — RECEIPTS (FDD pages 86–280)
What This Means (2025 FDD)
According to Epcon Communities' 2025 Franchise Disclosure Document, the consideration acknowledged in the Market Hold Agreement includes the franchisee paying a non-refundable fee of $5,000 to Epcon Communities Franchising, LLC. This fee, referred to as the "Initial Market Hold Fee," must be paid no later than when the franchisee executes the Market Hold Agreement.
In exchange for this fee, Epcon Communities agrees to reserve a specific market area for the franchisee for a period of twelve months, starting from the effective date of the Market Hold Agreement. During this term, Epcon Communities commits not to develop or grant a license to a third party to develop a project utilizing their Development System within the reserved market area. This exclusivity is subject to certain conditions outlined in Section 5 of the agreement, which are not detailed in this excerpt.
This arrangement allows a prospective Epcon Communities franchisee to secure a specific market while they evaluate the potential for development. The non-refundable nature of the $5,000 fee means that if the franchisee decides not to proceed with development in the reserved market area, they will not receive a refund. This type of market hold agreement is common in franchising, providing a period of exclusivity for the potential franchisee to conduct due diligence and secure financing.