When is the Floors To Go Early Termination Fee due?
Floors_To_Go Franchise · 2025 FDDAnswer from 2025 FDD Document
000 – [$30,000 X (20% x 2) = $12,000] = $18,000). The Early Termination Fee shall be due and payable to FTG in cash immediately on the date of any such early termination. You will not be required to repay any portion of the cost to Redesign your Showroom if you remain a FTG member for the entire initial five-year term.
ITEM 7. ESTIMATED INITIAL INVESTMENT
YOUR ESTIMATED INITIAL INVESTMENT
| Type of Expenditure | Amount | Method of Payment | When Due | To Whom Payment is to be Made |
|---|---|---|---|---|
| Initial Membership Fee(1) | $10,000 | $1,000 u |
Source: Item 6 — OTHER FEES (FDD pages 12–14)
What This Means (2025 FDD)
According to the 2025 Floors To Go Franchise Disclosure Document, the Early Termination Fee is due immediately upon early termination of the Membership Agreement. This fee applies if the Membership Agreement is terminated before the initial five-year term is completed. The fee is a reimbursement for the costs associated with the Redesign of the franchisee's showroom. The amount of the fee will be between $20,000 and $50,000.
The FDD provides an example of how the Early Termination Fee is calculated. If a franchisee becomes a member on March 1, 2025, and the cost of the Redesign was $30,000, and the membership is terminated on January 1, 2028, the franchisee would owe Floors To Go $18,000. This is calculated by reducing the initial $30,000 redesign cost by 20% for each full year of membership (20% x 2 years = 40% or $12,000), resulting in a fee of $18,000 ($30,000 - $12,000 = $18,000).
It is important to note that the franchisee will not be required to repay any portion of the redesign cost if they remain a Floors To Go member for the entire initial five-year term. This incentivizes franchisees to fulfill their initial term. The Early Termination Fee is payable in cash to Floors To Go on the date of early termination.