Is the transferee required to execute the Devon Creek standard form of Franchise Agreement?

According to Devon Creek's 2024 Franchise Disclosure Document, a transferee—someone to whom a franchise is being transferred—is required to execute the franchisor's standard form of Franchise Agreement. However, the FDD specifies that the terms and conditions in the new agreement may differ from the original agreement. A key exception to this requirement is that the transferee will not be required to pay the initial franchise fee again.

This requirement ensures that Devon Creek maintains control over who becomes a franchisee and that the new franchisee agrees to the current terms and conditions of the franchise system. While the transferee benefits from not having to pay the initial franchise fee, they must still meet all other qualifications and agree to the updated franchise agreement, which may include changes to operational standards, fees, or other obligations.

It is important for both the current franchisee (transferor) and the prospective franchisee (transferee) to carefully review the new Franchise Agreement. This review will help them understand any changes and ensure that the transfer is beneficial for both parties. The transferee should seek legal counsel to fully understand the implications of signing a new agreement with potentially different terms.