What is the deadline for a Fitstop franchisee to pay the Application Fee when proposing a transfer?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
rned transaction and any subsequent proposed sales or transfers by you. You shall provide us with written notice of any proposed transfer and shall comply with the provisions of the Right of First Refusal.
- 15.7 Included with your notice of proposed transfer, unless exempted, shall be your nonrefundable Application Fee of $500 payable to us. The Application Fee will be credited toward the Transfer Fee, as defined above, if the transferee is approved but will otherwise be forfeited to defray our expenses in connec
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee must include the nonrefundable Application Fee of $500 with their written notice of a proposed transfer. This fee is payable to Fitstop. While the fee is nonrefundable, it will be credited toward the Transfer Fee if Fitstop approves the transferee. However, Fitstop will keep the application fee to cover expenses if the transfer does not go through.
It's important to note that this Application Fee may be subject to an upward adjustment based on changes to the Consumer Price Index (CPI) from the date of the agreement to the date of the transfer. This means the franchisee could potentially pay more than $500 if the CPI has increased.
This requirement ensures that Fitstop is compensated for the administrative costs associated with reviewing and processing transfer applications, regardless of whether the transfer is ultimately approved. The franchisee should factor in the potential for an increased fee due to CPI adjustments when planning for a transfer.