What must a Bananas Smoothies Frozen Yogurt developer obtain if they determine to transfer the agreement?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
In connection with any transfer permitted under this Section, Developer agrees to provide Franchisor with all documents to be signed by Developer and the proposed assignee or transferee at least 30 business days prior to signing.
- 11.5 First Refusal. If Developer (or Developer's Owners) at any time determine to transfer this Agreement (as defined above) Developer will obtain a bona fide, signed written offer, an earnest money deposit (in the amount of 5% of more of the offering price) from a responsible and fully disclosed purchaser and submit an exact copy of such offer to Franchisor. The offer must apply only to an interest in this Agreement or Developer. It must not include the purchase of any other property or rights of Developer (or Developer's Owners). The offer must completely describe the purchase price, payment terms, terms of the assumption of liabilities and all other material terms of the transfer (including all exhibits and other information so that Franchisor may readily determine the foregoing). Within 30 days from the date Franchisor receives the copy of such offer, Franchisor may purchase Developer's rights under this Agreement and the assets of Developer's business on the terms and conditions contained in the offer provided to Franchisor, except that:
- (a) Franchisor may substitute cash for any form of payment proposed in the offer (with a discounted amount if an interest rate will be charged on any deferred payments);
- (b) Franchisor's credit will be deemed equal to the credit of any proposed purchaser;
- (c) Franchisor will have no less than 90 days to prepare for a closing; and
- (d) Franchisor is entitled to receive, and Developer and Developer's Owners agree to make, all customary representations and warranties given by the seller of the assets of a business or with the capital stock of an incorporated business, as applicable, including, without limitation, representations and warranties as to:
- (i) ownership and condition of and title to stock or other forms of ownership interests and/or assets;
- (ii) liens and encumbrances relating to the stock or other ownership interests and/or assets; and
- (iii) validity of contracts and the liabilities contingent or otherwise of the corporation whose stock is being purchased.
Source: Item 23 — RECEIPT (FDD pages 58–231)
What This Means (2025 FDD)
According to the 2025 Bananas Smoothies Frozen Yogurt FDD, if a developer decides to transfer their Area Development Agreement, they must first obtain a bona fide, signed written offer along with an earnest money deposit from a responsible and fully disclosed purchaser. The earnest money deposit must be at least 5% of the offering price. This offer must be submitted to Bananas Smoothies Frozen Yogurt for their consideration.
The offer provided to Bananas Smoothies Frozen Yogurt must apply only to the interest in the Area Development Agreement or the developer's business. It cannot include the purchase of any other property or rights of the developer. The offer needs to comprehensively detail the purchase price, payment terms, terms of assumption of liabilities, and all other significant terms of the transfer, including all exhibits and necessary information, enabling Bananas Smoothies Frozen Yogurt to readily understand the terms.
Bananas Smoothies Frozen Yogurt then has the option to purchase the developer's rights under the Area Development Agreement and the assets of the developer's business on the same terms and conditions as in the offer. However, Bananas Smoothies Frozen Yogurt can substitute cash for any proposed form of payment, with a discounted amount if an interest rate is applicable to deferred payments. Bananas Smoothies Frozen Yogurt's credit will be considered equal to that of any proposed purchaser, and they will have at least 90 days to prepare for the closing. Additionally, Bananas Smoothies Frozen Yogurt is entitled to receive all customary representations and warranties given by the seller of a business's assets or capital stock, including those related to ownership, condition, title, liens, encumbrances, and the validity of contracts.