Does the definition of 'transfer' for Cd One Price Cleaners include a sale?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
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. A transfer of the Store's and/or the Operating Assets'
Source: Item 23 — Receipts (FDD pages 72–263)
What This Means (2025 FDD)
According to Cd One Price Cleaners' 2025 Franchise Disclosure Document, the term "transfer" is broadly defined and explicitly includes a sale. This definition is important because franchisees need franchisor approval for any transfer of interest.
The FDD states that the term transfer includes any voluntary, involuntary, direct, or indirect assignment, sale, gift, or other disposition. This broad definition extends to various scenarios, such as the transfer of the franchise agreement itself, the store, operating assets, or ownership interests in the franchisee's business entity.
This means that a Cd One Price Cleaners franchisee cannot sell their franchise without first obtaining written approval from Cd One Price Cleaners. Failure to get this approval constitutes a breach of the franchise agreement, and any unapproved transfer will be considered ineffective. This provision allows Cd One Price Cleaners to maintain control over who operates their franchises and ensures that new franchisees meet their standards.