Does the definition of 'transfer' for Cd One Price Cleaners include an indirect assignment?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
nsible for all obligations of Franchisor under this Agreement from the date of assignment. In addition, and without limitation to the foregoing, Franchisee expressly affirms and agrees that Franchisor may sell its assets or its Proprietary Marks; may sell its securities in a public offering or in a private placement; may merge, acquire other companies, or be acquired by another company; and may undertake a refinancing, recapitalization, leveraged buy-out, or other economic or financial restructuring.
- 12.2 Transfer by Franchisee. Franchisee understands and acknowledges that Franchisor has granted the rights set forth in this Agreement in reliance on the business skill, financial capacity and personal character of Franchisee or, in the case of a business entity Franchisee, the owner(s) of any direct or indirect interest in Franchisee. Accordingly, neither: (i) this Agreement (or any interest in this Agreement); (ii) the Store (or any right to receive all or a portion of the Store's profits or losses or any capital appreciation relating to the Store); (iii) all or substantially all of the Operating Assets; nor (iv) any ownership interest in Franchisee (if Franchisee is a business entity) or in any of Franchisee's direct or indirect owners (if they are business entities) may be transferred without Franchisor's prior written approval, which Franchisor will not unreasonably withhold if the transfer meets all of the requirements in this Article 12.
Source: Item 23 — Receipts (FDD pages 72–263)
What This Means (2025 FDD)
According to Cd One Price Cleaners's 2025 Franchise Disclosure Document, the term "transfer" includes indirect assignments. Specifically, the definition covers any voluntary, involuntary, direct, or indirect assignment, sale, gift, or other disposition.
This definition extends not only to the agreement itself and the store, but also to ownership interests in the franchisee or its direct/indirect owners if they are business entities. This means that any change in ownership structure that effectively alters control or benefit from the franchise is considered a transfer, requiring franchisor approval.
For a prospective Cd One Price Cleaners franchisee, this broad definition means that any intended change in ownership, whether direct or indirect, needs to be carefully evaluated for compliance with the transfer requirements outlined in Article 12 of the franchise agreement. Failure to obtain prior written approval from Cd One Price Cleaners for any transfer, as defined, constitutes a breach of the agreement.