What must a proposed transferee of a Belocal franchise demonstrate to the Franchisor?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
(4) The proposed transferee shall have demonstrated to Franchisor's satisfaction that it meets Franchisor's then-current qualifications, and, at the transferee's expense, transferee and any of its principals and any other personnel required by Franchisor shall complete any training programs then in effect for N2 publication franchisees upon such terms and conditions as Franchisor may require;
(5) The transferee shall enter into a written agreement, in a form satisfactory to Franchisor, whereby transferee shall assume full, unconditional, and joint-and-several liability for, and agree to perform from the date of the transfer, all obligations, covenants, and agreements of Franchisee under this Agreement.
If the transferee is a corporation, partnership, limited liability company, or other entity, those of transferee's principals who are designated as principals by Franchisor must also execute such agreement and guarantee the performance thereof;
- (6) The transferee shall execute Franchisor's then-current form of franchise agreement for a term ending on the expiration date of this Agreement.
The new franchise agreement shall supersede this Agreement in all respects, and its terms may differ from the terms of this Agreement, including higher fees, but the transferee shall not be required to pay an initial franchise fee.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a proposed transferee must demonstrate to Belocal's satisfaction that they meet the then-current qualifications for franchisees. This includes completing any training programs in effect for N2 publication franchisees, at the transferee's expense. The transferee, along with any of its principals or personnel required by Belocal, must adhere to the terms and conditions set by Belocal for these training programs.
Furthermore, the transferee is required to enter into a written agreement, in a form satisfactory to Belocal, assuming full, unconditional, and joint-and-several liability for all obligations, covenants, and agreements of the franchisee from the date of transfer. If the transferee is a corporation, partnership, limited liability company, or other entity, those principals designated by Belocal must also execute this agreement and guarantee its performance.
Additionally, the transferee must execute Belocal's then-current form of franchise agreement for a term ending on the expiration date of the original agreement. This new agreement supersedes the original and may have different terms, including potentially higher fees. However, the transferee will not be required to pay an initial franchise fee. The transferor and its principals must also execute a general release of any and all claims against Belocal and its affiliates.
These conditions ensure that any new franchisee meets Belocal's standards and is fully committed to the obligations of the franchise agreement. Prospective franchisees should carefully consider these requirements and the potential for differing terms in the new franchise agreement, including higher fees, when evaluating a transfer.