Under what conditions can Bee Organized unreasonably withhold approval of a transfer?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
Provided Franchisee and each Owner and Spouse, respectively, are in substantial compliance with this Agreement and the Ancillary Agreements, and Franchisor does not elect to exercise Franchisor's right of first refusal as set forth in Article 14.F. below, Franchisor shall not unreasonably withhold its approval of a Transfer by Franchisee or an Owner. The proposed transferee (including such assignee's owner(s) and spouse(s) if the proposed transferee is a Corporate Entity) must be of good moral character, have sufficient business experience, aptitude and financial resources to own and operate a Bee Organized Business, and otherwise meet Franchisor's then applicable standards for franchisees as determined by Franchisor in its sole, but reasonable discretion. Furthermore, the proposed transferee and the proposed transferee's owners and spouses may not own or operate, or intend to own or operate, a Competitive Business. Franchisee agrees that Franchisor may condition approval of a Transfer upon Franchisee's satisfaction (either before, or contemporaneously with, the effective date of the Transfer) of the following:
- (1) Franchisee must provide written notice to Franchisor of the proposed Transfer of this Agreement at least 30 days prior to the Transfer, and Franchisee must have also satisfied the obligations set forth in Article 14.F. below;
- (2) All accrued monetary obligations of Franchisee and all other outstanding obligations to Franchisor and/or Franchisor's affiliates under this Agreement and the Ancillary Agreements must be satisfied in a timely manner, and Franchisee must satisfy all trade, supplier, and vendor accounts and other debts, of whatever nature or kind, in a timely manner;
- (3) Franchisee, each Owner, and each Spouse must not be in default or material breach of this Agreement or the Ancillary Agreements;
Source: Item 23 — RECEIPTS (FDD pages 54–218)
What This Means (2025 FDD)
According to Bee Organized's 2025 Franchise Disclosure Document, Bee Organized will not unreasonably withhold approval of a transfer if the franchisee, each owner, and their spouses are in substantial compliance with the Franchise Agreement and its ancillary agreements. This is also dependent on Bee Organized not electing to exercise its right of first refusal.
However, Bee Organized can reasonably withhold approval if the proposed transferee does not meet the brand's standards. The potential transferee must have good moral character, sufficient business experience, aptitude, and financial resources to successfully operate a Bee Organized franchise. The franchisor determines whether these standards are met at its sole discretion, provided that the determination is reasonable. Additionally, the transferee, including their owners and spouses, cannot own, operate, or intend to operate a competitive business.
To gain approval for a transfer, a Bee Organized franchisee must provide written notice to Bee Organized at least 30 days before the proposed transfer. The franchisee must also satisfy obligations outlined in Article 14.F of the franchise agreement. All outstanding monetary and other obligations to Bee Organized and its affiliates must be satisfied in a timely manner, including trade, supplier, and vendor accounts. The franchisee, each owner, and each spouse must not be in default or material breach of the Franchise Agreement or its ancillary agreements.