Is prior written consent required from Auntie Annes to transfer the franchise agreement?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
Any purported Transfer, without our prior written consent, will be null and void and will constitute a default under this Agreement, for which we may terminate this Agreement without opportunity to cure.
- A.
Requesting Consent.
If you or any of your Owners desire to make a Transfer, you must promptly provide us with written notice.
You agree to provide any information and documentation relating to the proposed Transfer that we reasonably require.
We have the right to communicate with both you, your counsel, and the proposed transferee on any aspect of a proposed Transfer.
No Control Transfer may be completed until at least 60 days after we receive all requested information to evaluate the proposed Control Transfer.
No other Transfer may be completed until at least 30 days after we receive all requested information to evaluate such proposed Transfer.
- B.
Granting Consent.
We have sole and absolute discretion to withhold our consent, except as otherwise provided in Sections 16.4 through 16.7.
Without limiting the foregoing, we will not consent to a Transfer, and we are under no obligation to do so, if (i) your Franchised Business is not open and operating; or (ii) the Transfer would cause a transferee or its owners to
breach another agreement (whether or not with us). Our consent to a Transfer does not constitute a waiver of any claims that we have against the transferor, nor is it a waiver of our right to demand exact compliance with the terms of this Agreement.
- 16.3 Control Transfer.
For a proposed Control Transfer, in addition to any other conditions that we may specify and without limiting in any way our sole and absolute discretion to grant or withhold consent for a proposed Control Transfer, at a minimum, the following conditions must be satisfied (unless waived by us):
- A.
You notify us in writing at least 90 days prior to any proposed Control Transfer and provide all requested information at least 60 days prior to any proposed Control Transfer.
- B.
All sums you owe us and our affiliates are paid.
- C.
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, prior written consent is required from Auntie Annes to transfer the franchise agreement. The FDD states that any transfer without prior written consent will be considered void and a default of the agreement, which may result in termination of the agreement without an opportunity to cure the default.
To request consent for a transfer, the franchisee must provide written notice to Auntie Annes and supply all reasonably required information and documentation related to the proposed transfer. Auntie Annes retains the right to communicate with the franchisee, their counsel, and the proposed transferee regarding any aspect of the proposed transfer.
Auntie Annes has sole and absolute discretion to withhold consent for a transfer, with some exceptions noted in other sections of the agreement. Specifically, consent may be withheld if the franchised business is not open and operating, or if the transfer would cause a transferee or its owners to breach another agreement. Consent to a transfer does not waive any claims Auntie Annes may have against the transferor, nor does it waive the right to demand compliance with the terms of the agreement. For a control transfer, the franchisee must notify Auntie Annes in writing at least 90 days prior to the proposed transfer and provide all requested information at least 60 days prior to the proposed control transfer. All sums owed to Auntie Annes and its affiliates must be paid.