Which item in the Counselor Realty Disclosure Document relates to the transfer of a Counselor Realty franchise?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
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| Provision | Section(s) in Franchise or Other Agreement | Summary |
|---|---|---|
| j. Assignment of contract by franchisor | Section 9.4 | Counselor may transfer its interest in Franchise Agreement by notice to you |
| k. "Transfer" by franchisee -- definition | Section 9.1 | Includes transfer of your interest in Franchise Agreement, the Office, Business or Business assets, or an interest in your business entity or your owners |
| l. Franchisor approval of transfer by franchisee | Section 9.1 | Counselor has the right to consent to all transfers (other than a transfer of less than a majority interest in your business entity or your owners) and will consent if Counselor deems transferee qualified and conditions specified in Franchise Agreement are satisfied |
| m. Conditions for franchisor approval of transfer | Sections 9.1, 9.2 | Transferee qualifies; payment of transfer fee; payment of all amounts owing; renovation to then-current System standards; execution of guaranty by buyer's shareholders or owners |
| n. Franchisor's right of | Section 9.6 | Counselor has the right of first |
| first refusal to acquire | refusal to match any offer for your | |
| franchisee's business | Business | |
| o. Franchisor's option to | Not applicable | Not applicable |
| purchase franchisee's | ||
| business | ||
| p. Death or disability of franchisee | Section 9.3 | Decedent's (or disabled person's) executor, heir, successor or legal representative must apply for Counselor's consent to transfer within 60 days after death or incapacity, and comply with transfer provisions of Franchise Agreement |
| q. Non-competition covenants during the term of the franchise | Section 7.2 | No direct or indirect involvement in any different or competing real estate brokerage service business within 50 miles of Office; no solicitation of agents, employees or independent |
| Provision | Section(s) in Franchise or Other Agreement | Summary contractors of Counselor or any of Counselor's franchisees |
| r. Non-competition covenants after the franchise is terminated or expires | 7.2 | No solicitation of agents, employees or independent contractors of Counselor or any of Counselor's franchisees for 24- months post-termination |
| s. Modification of the agreement | Section 13.2 | No modifications generally but Franchise Policy Guidelines and licensed Marks subject to change by Counselor |
| t. Integration/merger clause | Section 13.1 | Only the terms of the Franchise Agreement are binding on Counselor |
| u. Dispute resolution by arbitration or mediation | Section 10.1 | Most disputes are resolved by individual binding arbitration conducted in Minneapolis, Minnesota |
| v. Choice of forum | Not applicable | Not applicable |
| w. Choice of law | Section 13.2 | Minnesota law applies (except Minnesota Franchises Law applies only to franchisees whose principal place of business is located in Minnesota and to whom Minnesota Franchise Act applies by its own terms) |
| Provision | Section(s) in Franchise or Other Agreement | |
| j. | Assignment of contract by franchisor | Section 9.4 |
| k. | "Transfer" by franchisee definition | Section 9.1 |
| l. | Franchisor approval of transfer by franchisee | Section 9.1 |
| m. | Conditions for franchisor approval of transfer | Sections 9.1, 9.2 |
| n. | Franchisor's right of first refusal to acquire franchisee's business | Section 9.6 |
| o. | Franchisor's option to purchase franchisee's business | Not applicable |
| p. | Death or disability of franchisee | Section 9.3 |
| q. |
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 16–17)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, Item 17, titled "RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION," and Section 9 within Item 22, "CONTRACTS," contain information regarding the transfer of a Counselor Realty franchise. Item 17 provides a summary of transfer-related provisions, while Section 9 of Item 22 outlines the specific standards and conditions for franchise transfers. These sections detail the requirements and procedures a franchisee must follow to transfer their interest in the Franchise Agreement, the Office, Business, or Business assets.
Item 17 summarizes key aspects of franchise transfer, including the definition of "transfer" which encompasses various changes in ownership or control. It also highlights Counselor Realty's right to approve transfers, the conditions for approval (such as transferee qualifications, payment of fees, and adherence to system standards), and Counselor Realty's right of first refusal to acquire the franchisee's business. Additionally, it addresses the process in the event of the franchisee's death or disability, requiring the executor or legal representative to apply for consent to transfer within 60 days.
Section 9.1 of Item 22 further elaborates on transfer standards, stating that a franchisee cannot directly or indirectly change the ownership or control of their interest in the Franchise Agreement, the Office, Business, or assets without first offering Counselor Realty the right of first refusal and obtaining their consent. The franchisee and transferee must adhere to specific procedures, and the transferee may be required to sign the current form of the Counselor Realty Franchise Agreement for the remaining term. Counselor Realty will grant consent if the conditions in the agreement are met and the transferee is deemed qualified. There are some exceptions to the consent requirement for certain transfers of ownership interests that do not result in a change of control, provided Counselor Realty receives prior written notice and the transferee executes a guaranty.
Prospective franchisees should carefully review both Item 17 and Section 9 of Item 22 to fully understand the requirements, restrictions, and procedures involved in transferring a Counselor Realty franchise. Understanding these provisions is crucial for planning future business transitions and ensuring compliance with Counselor Realty's policies.