Must a Counselor Realty franchisee pay all amounts owing as a condition of transfer?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
We may specifically withhold consent if: (i) you do not pay all amounts you owe to Counselor or its affiliates or to your suppliers; (ii) you (or the transferee) do not complete the repair, maintenance or upgrade of the Business' facility, fixtures, equipment, and signage to then-current System standards; or (iii) all shareholders or owners of the transferee do not execute the guaranty of the new Agreement.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 25–29)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, a franchisee must pay all outstanding amounts owed to Counselor Realty as a condition for transfer approval. Specifically, Counselor Realty may withhold consent for a transfer if the franchisee has not paid all amounts owed to Counselor Realty, its affiliates, or its suppliers. This condition is detailed in Section 9.2 of the franchise agreement.
This requirement ensures that Counselor Realty does not approve a transfer if the franchisee is in debt to them. It protects Counselor Realty's financial interests and ensures that the new franchisee starts with a clean financial slate. The franchisee must also pay a transfer fee of $2,000, and the transferee may need to complete repairs or upgrades to meet the current system standards.
In addition to settling outstanding debts, the potential transferee must also meet Counselor Realty's qualifications and adhere to the conditions specified in the Franchise Agreement. All shareholders or owners of the transferee must execute a guaranty of the new agreement. These stipulations collectively aim to maintain the integrity and standards of the Counselor Realty franchise system during ownership transitions.