Is Afuri Ramen Dumpling required to consent to a franchise transfer?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
e believe based upon a review of the transferee's operational and business plans that the transferee's business operations might not be beneficial on a cash flow or financial basis.
- 7.1.3 We need not consent to any transfer to a competitor of ours.
- 7.1.4 We enter this Agreement, in part, in reliance upon the individual or collective character, skill, attitude, business ability and financial capacity of you (or your shareholders, members or partners, if you are a corporation, limited liability company, partnership or other entity).
- 7.1.5 You recognize that there are many subjective factors that comprise the process by which we select a suitable franchise owner. Our consent to a transfer by you will remain a subjective determination and will include, but not be limited to the following conditions. Before the effective date of a transfer we approve:
- A. The transferee must assume your Franchise obligations. You will remain bound by your covenants in this Agreement to not disclose Confidential Information and to not compete with us or our franchisees.
- B. You will pay all ascertained or liquidated debts concerning the Franchise.
- C. You may not be in breach of this Agreement or any other agreement between the parties. Our consent to the transfer will not constitute a waiver of any claims we may have against you.
- D. The transferee will pay for and complete to our exclusive satisfaction the training programs we then require of new franchisees or otherwise show to our satisfaction sufficient ability to successfully operate the Franchise.
- E. You or the transferee will pay a Transfer Fee according to our then-current Transfer Fee Schedule. This fee will reimburse us for our reasonable legal, accounting, credit check, and
investigation expenses that result f
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, Afuri Ramen Dumpling's consent to a franchise transfer is a subjective determination. The document outlines several conditions that must be met before a transfer is approved.
These conditions include the transferee assuming the franchise obligations, the franchisee remaining bound by confidentiality and non-compete agreements, and the franchisee paying all outstanding debts related to the franchise. Additionally, the franchisee must not be in breach of the Franchise Agreement or any other agreements with Afuri Ramen Dumpling. The franchisor's consent to the transfer does not waive any claims they may have against the franchisee.
The transferee must also complete the training programs required for new franchisees or demonstrate sufficient ability to operate the franchise successfully. Furthermore, either the franchisee or the transferee is responsible for paying a Transfer Fee, which, as of the FDD date, is $30,000. This fee covers Afuri Ramen Dumpling's expenses for legal, accounting, credit check, and investigation costs, as well as the mandatory training program for the transferee. Finally, the franchisee or transferee must refurbish, remodel, and replace the Franchise Premises, fixtures, equipment, and delivery vehicles, if applicable.
In summary, while a franchisee may seek to transfer their franchise, Afuri Ramen Dumpling maintains significant control over the transfer process. They can deny a transfer if the outlined conditions are not met to their satisfaction. The financial implications of a transfer, including the $30,000 transfer fee and potential refurbishment costs, should be carefully considered by prospective franchisees.