What is the successor franchise fee for a Red Wagon Club franchise?
Red_Wagon_Club Franchise · 2024 FDDAnswer from 2024 FDD Document
ich may differ materially from any and all of those contained in this Agreement, including the amount of the Program Fee, the Brand Fund contribution, and/or changes to the imposition of territorial protections; provided, however, that the term of the new franchise agreement signed will equal the remainder of the then-remaining Term;
- (9) Franchisee pays Franchisor, or arranges for the payment to Franchisor by the transferee, a transfer fee equal to 75% of Franchisor's then-current Initial Franchise Fee, unless (a) the transfer is o
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2024 FDD)
According to the 2024 Red Wagon Club Franchise Disclosure Document, the cost to transfer a franchise depends on the type of transfer. If a franchisee transfers their Red Wagon Club franchise, they must pay a transfer fee. This fee is equal to 75% of the then-current initial franchise fee.
However, there are exceptions to this general rule. If the transfer involves a non-controlling interest in the Red Wagon Club business between an existing employee, or between an existing employee and a new shareholder, the transfer fee is $1,500.
Additionally, if the transfer is to an existing Red Wagon Club franchisee, the transfer fee is equal to 33% of the then-current initial franchise fee. It is important to note that the transferee may be required to sign the then-current form of the franchise agreement, which may differ materially from the original agreement.