Under what conditions will Counselor Realty consent to a franchisee transfer?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
We will consent to a transfer if the conditions specified in this Agreement in our opinion are satisfied and the transferee in our opinion is qualified to operate the Business in compliance with that Agreement.
You must apply for our consent by submitting written notice of the pending transfer, with a complete application, signed by you and by the proposed transferee, and payment of the transfer fee, at least 60 days before the proposed transfer date.
The transfer fee is $2,000 and applies to all transfers (excluding transfers described in, and in accordance with, the second to last sentence of Section 9.1).
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.
Your death, disability or incapacity (or of a principal officer, director or partner of Franchisee) is also a "transfer." Your executor, heir or legal representative (or the corporation or partnership, if an entity) must apply within 60 days of the death or incapacity for our consent to transfer this Agreement and satisfy the other conditions above.
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, Counselor Realty has the right to consent to all franchise transfers, with some exceptions for minority interest transfers within a franchisee's business entity. Counselor Realty will generally consent to a transfer if it believes the conditions specified in the Franchise Agreement are satisfied and the transferee is qualified to operate the business in compliance with the agreement.
To initiate a transfer, the franchisee must submit a written notice of the pending transfer, along with a complete application signed by both the franchisee and the proposed transferee, at least 60 days before the proposed transfer date. A transfer fee of $2,000 is required, though this fee does not apply to transfers of minority ownership interests that do not result in a change of control. Counselor Realty also has the right of first refusal to acquire the franchise on the same terms as any offer from a third party.
Counselor Realty may withhold consent if the franchisee has not paid all amounts owed to Counselor Realty or its affiliates, or to the franchisee's suppliers. Consent may also be withheld if the franchisee or transferee has not completed required repairs, maintenance, or upgrades to the business's facilities, fixtures, equipment, and signage to meet the then-current system standards. Additionally, all shareholders or owners of the transferee must execute a guaranty of the new Franchise Agreement. The death, disability, or incapacity of the franchisee (or a principal officer, director, or partner) is also considered a transfer, requiring the executor, heir, or legal representative to apply for consent within 60 days and satisfy the standard transfer conditions.