What sections of the B Bops franchise agreement are changes in ownership of 50% or more subject to?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
Any change in ownership interests which, when taken alone or together with all previous or simultaneous changes in ownership during the Term hereof, constitutes a change of fifty percent (50%) or more of the ownership interests in Franchisee shall be considered a transfer subject to the provisions of Section 19(C) and 19(D) hereof.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, a change in ownership of 50% or more is considered a transfer and is subject to the provisions outlined in Sections 19(C) and 19(D) of the franchise agreement. This applies if the franchisee is a partnership, corporation, or limited liability company.
This means that if a franchisee experiences a significant shift in ownership, B Bops will treat it as if the franchise is being transferred to a new owner. Consequently, the franchisee must adhere to the transfer requirements specified in Sections 19(C) and 19(D). These sections likely contain stipulations such as obtaining B Bops's approval for the transfer, paying a transfer fee, and ensuring the new owner meets B Bops's qualifications and training standards.
For a prospective B Bops franchisee, this highlights the importance of understanding the implications of changes in ownership structure. If the franchisee anticipates potential changes exceeding the 50% threshold, they should carefully review Sections 19(C) and 19(D) to fully grasp the requirements and obligations involved in such a transfer. Failure to comply with these provisions could result in a breach of the franchise agreement and potential termination of the franchise.