When is a Precision Door Service franchisee not required to pay a transfer fee?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
unreasonably. You immediately must notify us of any proposed Transfer and must submit promptly to us the application for consent to Transfer. Any attempted Transfer by you without our prior written consent or otherwise not in compliance with the terms of this Agreement will be void and will provide us with the right to elect either to default and terminate this Agreement or to collect from you and the guarantors a Transfer fee equal to two times the Transfer fee provided for in Section 10.C as damages.
- C. Transfer Fee. You must pay to us a Transfer fee in the amount equal to $20,000. We will reduce the Transfer fee to $500 for a Transfer to an immediate family member (i
Source: Item 22 — Contracts (FDD pages 91–92)
What This Means (2025 FDD)
According to the 2025 Precision Door Service Franchise Disclosure Document, a franchisee is not required to pay a transfer fee under specific circumstances. If an individual franchisee wishes to transfer the agreement to a newly formed legal entity that they wholly own, established solely for the convenience of ownership and operation of the business, a transfer fee is not required. However, the franchisee must become a guarantor of the business, as required under Section 6.A of the agreement.
This provision allows a Precision Door Service franchisee to restructure their business for legal or operational efficiency without incurring a $20,000 transfer fee. This can be particularly beneficial for franchisees looking to separate their personal assets from their business liabilities or streamline their business operations.
It is important to note that this exception is specifically for transfers to a legal entity wholly owned by the franchisee and established for the convenience of ownership. Transfers to other entities or individuals, including family members (except for a reduced fee for immediate family), would still be subject to the standard transfer fee. This condition ensures that the franchisee remains personally invested in the business while allowing for structural flexibility.