If the Cd One Price Cleaners subtenant is an entity, what is required?
Cd_One_Price_Cleaners Franchise · 2025 FDDAnswer from 2025 FDD Document
isor (including the execution of personal guarantees), assuming and agreeing to fulfill all of Franchisee's obligations under this Agreement and all related agreements, or (ii) execute, for a term ending on the expiration of the Term, the form of franchise agreement and any ancillary documents then being offered to new CD Store franchisees (including the execution of personal guarantees); provided, however, that except as provided below, the transferee shall not be required to pay any initial franchise fee;
- 12.3.5 The transferee (and, if the transferee is a business entity, all owners of a beneficial interest in the transferee) shall demonstrate to Franchisor's satisfaction that it (and they) meet Franchisor's educational, managerial and business standards and do not operate or have any direct or indirect interest in any Competitive Business; possess a good moral character (if an individual or if an entity this shall apply to the principal(s) thereof), business reputation, and credit rating; have the aptitude, ability, and requisite financial resources and capital to operate the Store, as may be evidenced by prior related
business experience or otherwise; and that the terms of the proposed transfer do not place an unreasonable financial or operational burden on the transferee;
Source: Item 23 — Receipts (FDD pages 72–263)
What This Means (2025 FDD)
According to the 2025 Cd One Price Cleaners FDD, if the transferee is a business entity, all owners of a beneficial interest in the transferee must demonstrate to Cd One Price Cleaners' satisfaction that they meet the franchisor's educational, managerial, and business standards. These owners must also show they do not operate or have any direct or indirect interest in any Competitive Business.
Furthermore, the owners must possess a good moral character (if an individual or if an entity this shall apply to the principal(s) thereof), business reputation, and credit rating. They must also have the aptitude, ability, and requisite financial resources and capital to operate the Cd One Price Cleaners store. This can be evidenced by prior related business experience or otherwise, ensuring the financial and operational stability of the franchise.
Additionally, at Cd One Price Cleaners' option, all owners of a beneficial interest in the transferee business entity may be required to either (i) enter into a written assignment, in a form satisfactory to Cd One Price Cleaners (including the execution of personal guarantees), assuming and agreeing to fulfill all of Franchisee's obligations under this Agreement and all related agreements, or (ii) execute, for a term ending on the expiration of the Term, the form of franchise agreement and any ancillary documents then being offered to new CD Store franchisees (including the execution of personal guarantees).