What is the required wording of the stock restriction legend for City Wide franchisees?

According to City Wide's 2025 Franchise Disclosure Document, if the franchisee is a corporation, all stock certificates must contain a legend that provides notice of transfer restrictions. This is to ensure compliance with the franchise agreement's terms regarding transfers of ownership. The specific wording of this legend must be sufficient under applicable law to provide notice of the stock restrictions and allow them to be enforceable.

The purpose of this requirement is to ensure that City Wide maintains control over who becomes a franchisee and to prevent unauthorized transfers of ownership. This protects City Wide's interests by ensuring that all franchisees meet their standards and requirements. Without this restriction, a franchisee could potentially transfer ownership to an unqualified party without City Wide's knowledge or consent.

For a prospective City Wide franchisee, this means that if they operate their franchise through a corporation, they must ensure that all stock certificates include the required legend. Failure to do so could result in a breach of the franchise agreement and potential legal consequences. The franchisee should consult with an attorney to ensure that the legend meets all applicable legal requirements and adequately protects City Wide's interests. The FDD specifies that the legend will appear in substantially the form outlined in the franchise agreement.