What sections of the Exit Franchise Agreement address the fees that a franchisee is obligated to pay?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon the execution of this Agreement, Franchisee shall pay Subfranchisor, by cashier's check or wire transfer, an initial fee in the amount of [insert franchise price] (hereinafter "Initial Fee"). The Initial Fee shall be fully earned by Subfranchisor upon the execution of this Agreement, and no portion of the Initial Fee shall be refundable. The grant of this franchise and the payment of the Initial Fee provide Franchisee no rights regarding such other licenses, franchises or additions to the Protected Territory. No rights or privileges under this Agreement shall exist until the Initial Fee is paid.
7. CONTINUING FEES
7.1. EXIT Formula.
In addition to the Initial Fee, Franchisee, during the term of this Agreement and any extensions or renewal terms, shall pay Continuing Fees in accordance with the EXIT Formula (as incorporated in Section 19), which amounts shall be collected and paid to Subfranchisor or EXIT according to the EXIT Formula and as directed by Subfranchisor or EXIT, according to the Subfranchise Agreement between them. Continuing Fees shall be paid by electronic bank transfer or by such means as Subfranchisor and EXIT may direct.
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 18–19)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, several sections of the agreement outline the fees a franchisee must pay. Upon signing the agreement, the franchisee is obligated to pay an initial fee, the amount of which is specified in the franchise agreement. This initial fee is non-refundable and is considered fully earned by the subfranchisor once the agreement is executed.
In addition to the initial fee, Exit franchisees must also pay continuing fees throughout the term of the agreement. These continuing fees are determined by the Exit Formula, which is detailed in Section 19 of the agreement. The franchisee is responsible for paying these fees to either the subfranchisor or Exit, as directed, via electronic bank transfer or other specified means.
Furthermore, franchisees are required to pay a license fee, capped at $250 per month, for the use of Exit's proprietary computer software. This fee is collected through automatic monthly withdrawals. If a franchisee operates multiple Exit franchises under the same legal entity and trade name, the software license fee for subsequent franchises is reduced to 25% of the standard monthly fee.