Does a proposed assignee have to pay an initial franchise fee to Care Plus Medical Ucc?
Care_Plus_Medical_Ucc Franchise · 2024 FDDAnswer from 2024 FDD Document
LE 15. TRANSFERS**
- 15.1 By Care Plus Medical UCC. Care Plus Medical UCC may transfer or assign this Agreement, or any of its rights or obligations under this Agreement, to any person or entity, and Care Plus Medical UCC may undergo a change in ownership and/or control, without the consent of Franchisee.
- 15.2 By Franchisee. Franchisee acknowledges that the rights and duties set forth in this Agreement are personal to Franchisee and that Care Plus Medical UCC entered into this Agreement in reliance on Franchisee's business skill, financial capacity, personal character, experience, and business ability. Accordingly, Franchisee shall not conduct or undergo a Transfer without providing Care Plus Medical UCC at least 60 days prior notice of the proposed Transfer, and without obtaining Care Plus Medical UCC's consent. In granting any such consent, Care Plus Medical UCC may impose conditions, including, without limitation, the following:
- (i) Care Plus Medical UCC receives a transfer fee equal to $10,000 plus any broker fees and other out-of-pocket costs incurred by Care Plus Medical UCC;
- (ii) the proposed assignee and its owners have completed Care Plus Medical UCC's franchise application processes, meet Care Plus Medical UCC's then-applicable standards for new franchisees, and have been approved by Care Plus Medical UCC as franchisees;
- (iii) the proposed assignee is not a Competitor;
- (iv) the proposed assignee executes Care Plus Medical UCC's then-current form of franchise agreement and any related documents, which form may contain materially different provisions than this Agreement (provided, however, that the proposed assignee will not be required to pay an initial franchise fee);
- (v) all owners of the proposed assignee provide a guaranty in accordance with Section 2.5;
- (vi) Franchisee has paid all monetary obligations to Care Plus Medical UCC and its affiliates, and to any lessor, vendor, supplier, or lender to the Business, and Franchisee is not otherwise in default or breach of this Agreement or of any other obligation owed to Care Plus Medical UCC or its affiliates;
- (vii) the proposed assignee and its owners and employees undergo such training as Care Plus Medical UCC may require;
Source: Item 22 — CONTRACTS (FDD page 41)
What This Means (2024 FDD)
According to Care Plus Medical Ucc's 2024 Franchise Disclosure Document, a proposed assignee will not be required to pay an initial franchise fee if the franchisee transfers the agreement to them. However, Care Plus Medical Ucc does impose other conditions for granting consent to a transfer.
Care Plus Medical Ucc may require a transfer fee of $10,000 plus any broker fees and out-of-pocket costs incurred by Care Plus Medical Ucc. The proposed assignee must also complete Care Plus Medical Ucc's franchise application processes, meet the then-applicable standards for new franchisees, and be approved by Care Plus Medical Ucc as a franchisee. Additionally, the proposed assignee cannot be a competitor and must execute Care Plus Medical Ucc's then-current form of franchise agreement and any related documents, which may contain materially different provisions than the original agreement.
Furthermore, all owners of the proposed assignee must provide a guaranty, and the franchisee must have paid all monetary obligations to Care Plus Medical Ucc and its affiliates, as well as to any lessor, vendor, supplier, or lender to the business. The franchisee must not be in default or breach of the agreement or any other obligation owed to Care Plus Medical Ucc or its affiliates. The proposed assignee and its owners and employees must also undergo any training that Care Plus Medical Ucc may require, and both the franchisee and the transferee must execute a general release of Care Plus Medical Ucc.