What is the prohibited action for a Beehive Homes franchisee regarding the transfer of their franchise?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
YOU may not transfer YOUR franchise without OUR prior written consent. If WE consent to a transfer of the franchise by YOU, a fee of $2,500.00 for certain Permitted Transfers or $15,000.00 for certain approved transfers must be paid, by either YOU or the approved transferee to reimburse US for OUR reasonable legal, accounting, credit or other investigation expenses. This transfer fee is nonrefundable and is payable at the time of the approved transfer. If WE arrange the transferee for YOU, YOU must pay US a nonrefundable commission equal to six percent (6%) of the gross transfer price, in addition to the transfer fee. For certain Unauthorized Transfers, YOU will pay US a transfer fee equal to 10 times the amount of Franchise Fees paid for the highest 12 of the 18 months preceding the transfer.
NOTE: These fees are uniformly imposed on all franchisees.
Source: Item 6 — OTHER FEES (FDD pages 11–13)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, a franchisee may not transfer their franchise without the prior written consent of Beehive Homes. If Beehive Homes consents to the transfer, the franchisee or the approved transferee must pay a fee to reimburse Beehive Homes for reasonable legal, accounting, credit, or other investigation expenses. The transfer fee is $2,500.00 for certain Permitted Transfers or $15,000.00 for certain approved transfers. This fee is nonrefundable and payable at the time of the approved transfer.
Furthermore, if Beehive Homes arranges the transferee for the franchisee, the franchisee must pay Beehive Homes a nonrefundable commission equal to six percent (6%) of the gross transfer price, in addition to the transfer fee. For certain Unauthorized Transfers, the franchisee will pay Beehive Homes a transfer fee equal to 10 times the amount of Franchise Fees paid for the highest 12 of the 18 months preceding the transfer. These fees are uniformly imposed on all franchisees.
This means that a Beehive Homes franchisee cannot simply sell or give away their franchise to someone else without getting approval from Beehive Homes first. This is a common provision in franchise agreements, as franchisors want to ensure that any new franchisee meets their standards and is capable of running the business successfully. The transfer fees are in place to cover the franchisor's costs of evaluating and approving the transfer. The significantly higher fee for unauthorized transfers is designed to strongly discourage franchisees from attempting to bypass the approval process.
Prospective franchisees should carefully consider these transfer provisions and understand the costs and procedures involved if they ever want to sell their Beehive Homes franchise. It is important to maintain open communication with Beehive Homes and follow the proper channels to ensure a smooth and compliant transfer process.