What conditions must be met for Afuri Ramen Dumpling to approve a transfer of a franchise?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Franchise Agreement ("FA") | Summary |
|---|---|---|
| i. Franchisee's obligations on termination or nonrenewal. | FA Section 6.5 & 6.8 | De-identification, return of manuals, release of phone numbers and listings, de identification of your franchise equipment and premises, payment of sums owed, confidentiality, and non competition. |
| j. Assignment of contract by | FA Section 7.1 | There are no restrictions on our |
| franchisor | right to transfer. | |
| k. "Transfer" by franchisee – defined | FA Section 7.1 | Restrictions apply if you sell, transfer, assign, encumber, give, lease, or sublease (collectively called "transfer") the whole or any part of the franchise agreement, substantial assets of the franchise, or ownership or control of you. |
| l. Franchisor's approval of | FA Section 7.1 | We have the right to approve all |
| transfer by franchisee | transfers. | |
| m. Conditions for franchisor approval of transfer | FA Section 7.1 | The transferee must qualify as a franchisee, assume your obligations, and successfully pay for and complete the mandatory training. You may not be in default, must release us, and you or the transferee must pay the Transfer Fee. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 40–45)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the company has the right to approve all transfers of a franchise. For Afuri Ramen Dumpling to approve a transfer, several conditions must be met.
First, the transferee (the person or entity buying the franchise) must qualify as a franchisee. This likely involves meeting Afuri Ramen Dumpling's standards for financial stability, business experience, and personal character. Second, the transferee must assume all of the existing franchisee's obligations under the Franchise Agreement. This means the new franchisee steps into the shoes of the old one, taking on all responsibilities and liabilities.
Additionally, the transferee must successfully pay for and complete the mandatory training program. This ensures that the new franchisee is properly trained in Afuri Ramen Dumpling's operating procedures and standards. The current franchisee must not be in default of the Franchise Agreement. Finally, either the current franchisee or the transferee must pay the Transfer Fee to Afuri Ramen Dumpling. These conditions ensure that Afuri Ramen Dumpling maintains control over who operates its franchises and that any new franchisee is properly qualified and trained.