What are the requirements for a proposed transferee of a Cilantro Taco Grill multi-unit franchise?
Cilantro_Taco_Grill Franchise · 2024 FDDAnswer from 2024 FDD Document
- 6.3 Transfers by Multi-Unit Operator.
Multi-Unit Operator shall not directly or indirectly sell, assign, transfer, give, devise, convey or encumber this Agreement or any right granted or interest herein or hereunder (a "Transfer") or suffer or permit any such assignment, transfer, or encumbrance to occur by operation of law unless Multi-Unit Operator first obtains the written consent of Franchisor, which Franchisor may or may not grant in Franchisor's sole discretion, and subject to the following:
6.3.1 The proposed transferee must be an individual of good moral character and otherwise meet Franchisor's then-applicable standards for multi-unit franchisees.
6.3.2 The transferee must have sufficient business experience, aptitude and financial resources to operate multiple Cilantro Taco Grill outlets and to comply with this Agreement;
6.3.3 The transferee has agreed to complete Franchisor's HQ Initial Training program to Franchisor's satisfaction;
6.3.4 Multi-Unit Operator has paid all amounts owed to (i) Franchisor pursuant to this Agreement and all Franchise Agreements and other agreements between Franchisor and/or Franchisor's affiliates and Multi-Unit Operator and (ii) third-party creditors;
Source: Item 23 — RECEIPT (FDD pages 52–208)
What This Means (2024 FDD)
According to the 2024 Cilantro Taco Grill Franchise Disclosure Document, a Multi-Unit Operator cannot directly or indirectly transfer the agreement without the Franchisor's written consent, which may or may not be granted at the Franchisor's discretion.
The proposed transferee must meet several qualifications. First, the transferee must be an individual of good moral character and meet Cilantro Taco Grill's standards for multi-unit franchisees. Second, the transferee must possess sufficient business experience, aptitude, and financial resources to operate multiple Cilantro Taco Grill outlets and comply with the agreement. Third, the transferee must agree to complete Cilantro Taco Grill's HQ Initial Training program to the Franchisor's satisfaction.
Finally, the Multi-Unit Operator must have paid all outstanding amounts owed to Cilantro Taco Grill, its affiliates, and third-party creditors. These conditions ensure that any new Multi-Unit Operator is well-qualified and financially stable, protecting the Cilantro Taco Grill brand and system.