If a City Wide franchisee wants to transfer their franchise, what is the first step they should take?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee, an Affiliated Company or an Owner desire to make a Transfer to a person or entity other than as described in Section 13.3 or 13.6, such person or entity must comply with the following terms, conditions, and procedures to effectuate a valid Transfer:
13.4.1 Franchisee will first notify CITY WIDE in writing of the proposed Transfer with a complete description of all terms of the proposed Transfer, including the prospective transferee's name, address, financial qualifications, and previous five (5) years' business experience.
13.4.2 The proposed transferee will then apply for a Franchised Business under the System and must meet all of CITY WIDE's then-current standards and requirements for becoming a franchisee.
13.4.3 CITY WIDE may, within sixty (60) days after receipt of such notice or application, whichever is later, exercise the right to purchase the interest being offered by Franchisee, an Affiliated Company, or any Owner ("Option") by matching the monetary purchase price and payment schedule terms (without having to match any other non-monetary terms) of the proposed Transfer.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to the 2025 City Wide Franchise Disclosure Document, a franchisee who wishes to transfer their franchise must first notify City Wide in writing. This notification must include a complete description of all terms of the proposed transfer, including the prospective transferee's name, address, financial qualifications, and previous five years of business experience. This initial notification is a critical step, as it provides City Wide with the necessary information to evaluate the proposed transfer and the potential transferee.
Following the franchisee's notification, the proposed transferee must then apply for a City Wide franchise and meet all of City Wide's then-current standards and requirements for becoming a franchisee. This ensures that any new franchisee meets the brand's standards for qualifications and training. City Wide also retains the right to purchase the franchisee's interest by matching the monetary purchase price and payment schedule terms of the proposed transfer, excluding any non-monetary terms. This is known as the Option and must be exercised within sixty days of receiving the transfer notice or application, whichever is later.
If City Wide decides not to exercise its Option to purchase the franchise, it will then notify the franchisee in writing of its approval or disapproval of the prospective transferee within thirty days after the Option has expired. If the proposed transferee is approved, the franchisee can proceed with the transfer, provided that the terms are no more favorable than those initially offered to City Wide. The franchisee must also ensure that the transferee completes the required initial training and pays all associated fees. Prior to the transfer, the franchisee must pay all outstanding amounts owed to City Wide, resolve any breaches of agreements, and provide a general release of claims against City Wide.