Under what conditions will the Subfranchisor consent to a transfer of an Exit franchise?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Subfranchisor will not unreasonably withhold its consent, which consent must be in writing, to any proposed Transfer, provided Franchisee and/or the transferee comply with the following, non-exclusive, conditions:
- (A) Franchisee shall have fully complied with the provisions of this Agreement, curing all defaults and noncompliance under this Agreement and any other franchise agreements it may have with Subfranchisor and EXIT; and
- (B) Franchisee shall have paid fully all monies due EXIT, Subfranchisor, and Brokers' Council; and
- (C) Franchisee shall submit to Subfranchisor current, accurate financial statements and other documents sufficient to enable Subfranchisor to determine and approve (in its discretion) the character, integrity, creditworthiness, business experience, reasonable net worth, professional credentials and ethical background of the proposed transferee; and
- (D) Franchisee shall furnish Subfranchisor with copies of the transfer documents, in a form acceptable to Subfranchisor; and
- (E) Franchisee shall provide both the proposed transferee and Subfranchisor complete financial information on the subject franchise required by the transferee; and
- (F) Franchisee shall provide Subfranchisor, on the then current form prescribed by Subfranchisor or EXIT, a full general release and waiver in favor of Subfranchisor, EXIT and their affiliates; and
- (G) Franchisee shall pay the transfer fee required under Section 18.5;
- (H) The proposed transferee shall sign Subfranchisor's then current form of Guaranty of this Agreement; and
- (I) The proposed transferee shall complete, or agree to complete, the training required under Section 9.11.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the subfranchisor will not unreasonably withhold consent to a proposed transfer of the franchise, provided that the franchisee and/or the transferee comply with certain conditions. These conditions are non-exclusive, meaning the subfranchisor may have additional requirements.
Specifically, the franchisee must be in full compliance with the franchise agreement, curing all defaults and noncompliance under the agreement and any other agreements they may have with Exit or the subfranchisor. All monies due to Exit, the subfranchisor, and the Brokers' Council must be paid in full. The franchisee must also submit current and accurate financial statements and other documents that allow the subfranchisor to assess the character, integrity, creditworthiness, business experience, net worth, professional credentials, and ethical background of the proposed transferee.
Additional requirements include providing copies of the transfer documents in a form acceptable to the subfranchisor, complete financial information on the franchise to both the transferee and subfranchisor, and a full general release and waiver in favor of the subfranchisor, Exit, and their affiliates. The franchisee must also pay the required transfer fee. The proposed transferee must sign the subfranchisor's current form of Guaranty of the Agreement and complete, or agree to complete, the required training.