What section of the Counselor Realty Franchise Agreement defines 'transfer' by the franchisee?

According to Counselor Realty's 2025 Franchise Disclosure Document, Section 9.1 of the Franchise Agreement defines what constitutes a 'transfer' by the franchisee. This definition is broad, encompassing not only the transfer of the franchisee's interest in the Franchise Agreement itself, but also the transfer of the physical office, the business operations, or the business assets. Furthermore, if the franchisee is a business entity, any transfer of ownership interest or control within that entity also falls under this definition.

This comprehensive definition is important for prospective Counselor Realty franchisees to understand because it establishes the scope of restrictions and requirements related to transferring any aspect of the franchise. It clarifies that any significant change in ownership or control, whether direct or indirect, is subject to the franchisor's approval. This includes scenarios where the franchisee might sell a portion of their business, bring in a new partner, or even alter the ownership structure of their company.

The FDD excerpt also indicates that Counselor Realty retains the right of first refusal to acquire the franchise before a franchisee can transfer it to a third party. Additionally, Counselor Realty's consent is required for most transfers, with specific conditions that must be met for approval. However, there is an exception where Counselor Realty's consent is not required for a transfer that will not result in a change in Control of Franchisee or such direct or indirect owner of Franchisee, you provide Counselor with written notice of such transfer, together with such other information concerning such transfer and transferee as we may require, at least thirty (30) days prior to the consummation of such transfer, and if such transfer is a transfer of an ownership interest in Franchisee, such transferee executes the guaranty attached to this Agreement and delivers such guaranty to Counselor within ten (10) days of such transfer.

Understanding these transfer provisions is crucial for any potential Counselor Realty franchisee, as it directly impacts their ability to exit the business or make changes to its ownership structure. Franchisees should carefully review Section 9.1 and related sections to fully grasp the implications and requirements for any future transfer scenarios.