What is the transfer fee for Exit franchisees if the transfer is considered a Minor Transfer?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
.3](#page-71-1) of this Agreement. The disposition shall be completed within a reasonable time, not to exceed nine (9) months from the date of the death or permanent disability. Failure to so transfer the interest within the nine (9) month period shall constitute a breach of this Agreement.
18.5. Transfer Fee
Franchisee must pay Subfranchisor a transfer fee, which will vary depending on whether the Transfer is a Major Transfer or a Minor Transfer. If the Transfer is a Major Transfer, the transfer fee is an amount equal to 10% of the then current Initial Fee (not to exceed 25% of the Initial Franchise fee paid) on the date of the Transfer. If the Transfer is a Minor Transfer, the transfer fee is an amount equal to $500.00. The transfer fee is nonrefundable even if, for any reason, the proposed Transfer does not occur. For purposes of this section, the following definitions apply:
(A) Major Transfer. The Transfer of a 50% or more interest in this Agreement or 50% or more interest in the equity or voting rights in the entity that owns or controls this Agreement, whether in one or more transfers.
(B) Minor Transfer. Transfer of less than a 50% interest in this Agreement, or less than 50% interest in the
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the transfer fee for a Minor Transfer is $500.00. This fee is payable to the Subfranchisor and is nonrefundable, regardless of whether the transfer is completed.
A Minor Transfer, as defined in the FDD, involves the transfer of less than a 50% interest in the franchise agreement or less than 50% of the equity or voting rights in the entity that owns or controls the agreement. This also applies if the transfer is to an entity with the same equity ownership as the transferor.
It's important to note that no transfer fee is required if an individual franchisee assigns their interest to a legal entity, provided it aligns with Section 14.2 of the agreement. Prospective franchisees should carefully consider these transfer conditions and fees as part of their investment decision.