What is the 'Application Fee' amount required for a Fitstop franchise transfer?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
or by operation of law), directly, indirectly, or contingently any interest in this Franchise without our express written consent, and then only in accordance with the express limitations of this Section.
- 15.2 You shall pay an Assignment/Transfer Application Fee ("Application Fee") of $500.00 to us per application to assign or transfer and then upon approval, you, or if agreed upon between the parties, the subsequent franchisee must pay the Assignment/Transfer Fee ("Transfer Fee") of $25,000.00 before or at the time of transfer or assignment to a new franchisee.
- 15.3 You shall notify us in writing of the terms and conditions of any proposed transfer, including, but not limited to the interest proposed to be transferred, the purchase price or other consideration to be received therefore, any credit or financing terms being extended by the seller, the date of the proposed transfer, and all other pertinent provisions of the proposed transfer. In addition, a copy of any and all contracts, agreements, memoranda of sale, deposit receipts, letters of intent, side letter agreements and/or the like, must also be forwarded to us as soon as signed by the proposed seller.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee must pay an Assignment/Transfer Application Fee of $500 when applying to transfer their franchise. This fee is nonrefundable but will be credited towards the Transfer Fee if Fitstop approves the transferee. However, the Application Fee will be forfeited to Fitstop to cover expenses if the transferee is not approved.
There are some exceptions to the transfer fee. According to the FDD, the transfer of a Fitstop franchise from an individual or partnership to a corporation wholly-owned by the preexisting owner(s) does not require the payment of the application or transfer fees. Also, if the transfer is to a named beneficiary or to the spouse or an adult child of an individual, transfer fees are not payable.
The Application Fee is subject to upward adjustment based on changes to the Consumer Price Index (CPI) from the date of the Franchise Agreement to the date of the transfer. This means the actual fee could increase over time due to inflation. The franchisee is responsible for notifying Fitstop of the terms of any proposed transfer.