Under what condition does Golden Corral not impose a transfer fee?
Golden_Corral Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Transfer Fee | Franchisees pay 5% of the then-current initial franchise fee. Developers pay the greater of 5% of the aggregate development fee paid by the selling developer or our costs to review the proposed transfer | Before transfer | We do not impose a fee for transfers from a partnership or sole proprietorship to a corporation in which the former partners or sole proprietors own all of the outstanding stock |
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Golden Corral's 2025 Franchise Disclosure Document, Golden Corral does not impose a transfer fee under specific conditions related to business structure changes. Specifically, the transfer fee is waived when a transfer occurs from a partnership or sole proprietorship to a corporation, provided that the former partners or sole proprietors retain complete ownership of all outstanding stock in the new corporation. This policy can be beneficial for franchisees looking to incorporate their business for liability or tax reasons without incurring additional transfer fees.
For franchisees considering a transfer, it's important to ensure that the new corporate structure adheres strictly to the ownership requirements outlined in the FDD. Any deviation from this, such as partial ownership by outside parties, could trigger the standard transfer fee, which is 5% of the then-current initial franchise fee for franchisees or the greater of 5% of the aggregate development fee paid by the selling developer or Golden Corral's costs to review the proposed transfer for developers.
This exception is relatively common in franchising, as franchisors often aim to support franchisees in making reasonable business adjustments without imposing undue financial burdens, provided the underlying control and ownership remain consistent. Franchisees should consult with legal and financial advisors to ensure full compliance with Golden Corral's requirements when planning such a transfer.