The amount paid when the deposit contract is signed is deducted from the amount to be paid for the purchase. This means that the amount of the deposit is deducted from the final price of the purchase of the property. There are several types of deposits below, let`s explain what they exist in. The City commits and entrusts to the Commission, the Corporation, the Joint Board of Directors, the trustee of obligations and the trustee of the deposits, as guarantee of all costs and expenses related to this transaction, due in accordance with the conditions of sublease, lease, discernment and this deposit contract, which are then due and due. , all amounts to be paid into the account in additional costs. A deposit agreement is a contract between a franchisor and a potential franchisee in the negotiation phase before the parties enter into a formal franchise agreement. The purpose of the agreement is to determine the surety that the franchisee must pay to the franchisor, the purpose of the bond and the circumstances in which the deposit is repaid or not. If the franchisor and franchisee finally enter into a franchise agreement, the surety should be refunded by the franchisor or deducted from the franchise`s initial franchise fee. If the franchisee decides to withdraw from negotiations after signing a deposit contract, part of the deposit can be refunded. The British Franchise Association`s Code of Ethics provides that the franchisor may withhold a portion of the deposit in order to cover any direct costs incurred during the pre-franchise agreement negotiations, but the remainder of the deposit should be refunded to the franchisee.

Direct expenses can cover expenses already spent on the creation of the franchise, such as brokerage fees. B, surveying, lawyer and accountant, as well as the costs of studying the area on which the franchisee intends to build up. Details of the fees deducted from the refundable deposit must be stated in writing in the deposit agreement.