Must the transferee of a Caring Senior Service franchise assume all of the business liabilities?
Caring_Senior_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) your being then in full compliance herewith and settling and paying to us or our affiliates and all trade creditors of the Business all outstanding debts;
- (b) the transferee executing our then-current franchise agreement (which shall have a term equal to the remainder of the term hereof) and such other ancillary agreements, guarantees, instruments and documents then customarily used by us to grant Business franchises and satisfactorily completing all required training, at the transferee's expense;
- (c) you and your officers, directors, shareholders, managers and members, if a corporate entity, executing a general release of us, our officers, directors and employees;
- (d) the transferee purchasing all of the assets used in the Business in accordance with all applicable bulk sales legislation and assuming all of your business liabilities;
- (e) the transferee's demonstration our satisfaction that the transferee meets our thencurrent educational, managerial and business standards; possesses a good moral character, business reputation and credit rating; has the aptitude and ability to operate the Business; has sufficient equity capital to operate the Business; and otherwise meets all the criteria for "Caring Senior Service" franchisees;
- (f) you pay to us a transfer fee in an amount equal to Twenty Percent (20%) of our then-current Franchise Fee; and
(g) you and transferee entering into a written agreement of purchase and sale, the form and content of which shall be subject to our approval. The economic terms of the transfer may not materially and adversely affect, in our sole judgment, the post-transfer viability of the Business.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 39–45)
What This Means (2025 FDD)
According to the 2025 Caring Senior Service Franchise Disclosure Document, if a franchisee transfers their franchise, the transferee must assume all of the business's liabilities. Specifically, the transferring franchisee must ensure that the transferee agrees to this condition as part of the transfer process.
This requirement is one of several conditions that must be met for a transfer to be approved by Caring Senior Service. Other conditions include the transferring franchisee being in full compliance with the franchise agreement, settling all outstanding debts to Caring Senior Service and its affiliates, and paying all trade creditors of the business. The transferee must also execute the then-current franchise agreement, complete required training at their own expense, and demonstrate that they meet Caring Senior Service's standards for franchisees.
Furthermore, both the transferring franchisee and their officers/directors (if a corporate entity) must execute a general release of Caring Senior Service, its officers, directors, and employees. The transferring franchisee must also pay Caring Senior Service a transfer fee equal to 20% of the then-current franchise fee. Finally, a written agreement of purchase and sale, approved by Caring Senior Service, must be entered into between the transferring franchisee and the transferee, with economic terms that do not adversely affect the post-transfer viability of the business.