Can the Holder assign the Caring Senior Service Guaranty, and if so, under what conditions?
Caring_Senior_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
If you or any successor thereof is a partnership, corporation or limited liability company, or if the franchise granted hereunder is assigned to a partnership, corporation or limited liability company pursuant to Article 16 hereof:
- (a) upon the execution of this Agreement (or, in the case of an assignment, upon such assignment) and subject to the provisions of Article 16 hereof, upon each transfer of an interest in this Agreement or in you, all holders of an interest in you shall execute a written agreement with us in the form required by us individually undertaking to be bound, jointly and severally, by all of the terms of this Agreement;
- (b) the articles of partnership, partnership agreement, articles of incorporation, bylaws, articles of organization, operating agreement and other organization documents shall recite that the issuance and transfer of any interest therein is restricted by the terms of Article 16 of this Agreement and copies thereof shall be furnished to us at our request. You shall also submit to us, at any time upon request, a list of names and addresses of all directors, officers, partners and members or beneficial shareholders reflecting their respective interests in you and other information regarding you, in such form as we may require;
- (c) upon the execution of this Agreement, provide us with a certificate of good standing or due organization of the franchisee business entity from the Secretary of State or applicable state agency;
- (d) upon the execution of this Agreement, provide a certified resolution by the board of directors or members authorizing the corporation, partnership, or limited liability company to enter into the Franchise Agreement with Caring Senior Service Franchise Partnership, L.P. and designating the name of the officer authorized to execute the Franchise Agreement on behalf of the corporation, partnership, or limited liability company.
- (e) upon the execution of this Agreement, provide a written document stating the name of the member, officer, director, or other principal responsible for the day-to-day operation of the Franchised Business; and
- (f) you, if you are a corporation, shall maintain stop transfer instructions against the transfer on your records of any securities with voting rights subject to the restrictions of Article 16 hereof and shall issue no such securities, nor permit a
Source: Item 23 — RECEIPTS (FDD pages 53–204)
What This Means (2025 FDD)
According to the 2025 Caring Senior Service Franchise Disclosure Document, if the franchisee is a partnership, corporation, or limited liability company, or if the franchise is assigned to one of these entities, certain conditions apply regarding the transfer of interests.
Specifically, upon the execution of the Franchise Agreement or any subsequent assignment, all interest holders in the franchisee entity must individually agree in writing to be bound by all terms of the agreement. The organizational documents of the franchisee (partnership agreement, articles of incorporation, etc.) must state that any interest issuance or transfer is restricted by the terms outlined in Article 16 of the agreement. These documents must be provided to Caring Senior Service upon request. Additionally, Caring Senior Service requires a list of names and addresses of all directors, officers, partners, members, or beneficial shareholders, detailing their respective interests in the franchisee entity.
Furthermore, the franchisee must provide a certificate of good standing or due organization from the relevant state agency and a certified resolution from the board of directors or members authorizing the entity to enter into the Franchise Agreement. This resolution should also designate the officer authorized to execute the agreement on behalf of the entity. A written document must also be provided, stating the name of the member, officer, director, or other principal responsible for the day-to-day operation of the franchised business. If the franchisee is a corporation, it must maintain stop transfer instructions against the transfer of any securities with voting rights, subject to the restrictions of Article 16, and must not issue such securities or permit a transfer that violates these restrictions.
These stipulations ensure that Caring Senior Service maintains control over who is involved in the franchise and that all parties are bound by the franchise agreement's terms, even if the franchise is operated through a business entity. This is a common practice in franchising to protect the brand and ensure consistent operation across all franchise locations.