Does Beehive Homes require that the Assignor, Assignee, and Shareholders/Partners/Members warrant that they are the only persons or entities with equity interests in Assignee?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
Equity interests, as used in this Assignment, include direct or indirect equity or beneficial interests in Assignee and the business risks associated with the Home including, but not limited to, interests stated as debt that include any type of risk-taking interest or any interest in the profits or appreciation of the Home.
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- Assignor, Assignee, and [Shareholders/Partners/Members] represent and warrant that:
- a) they are the only persons or entities with equity interests in Assignee and their ownership interests are as shown on Exhibit A; and
- b) there is no obligation or intention to issue additional equity interests in Assignee.
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- If any [Shareholders/Partners/Members] are trustees or trusts:
- a) the beneficial interests in the trusts may not be assigned, transfers to successor trustees or special trustees may not be made even if the transfer is provided for in any trust agreement, and the trust agreement may not be amended without the prior written consent of Bee Hive Homes;
- b) Exhibit A lists all persons who are trustees of any nature or have beneficial interests in any [Shareholder's/Partner's/Member's] trust(s);
- c) this Assignment is not a consent to any future transfers of equity interest(s) of Assignee to any [Shareholder's/Partner's/Member's] trust beneficiaries based on any
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, in the context of an assignment of a franchise, the Assignor, Assignee, and any associated Shareholders, Partners, or Members must represent and warrant that they are the only persons or entities with equity interests in the Assignee. Their ownership interests must be accurately reflected on Exhibit A of the assignment agreement. They must also warrant that there is no obligation or intention to issue additional equity interests in the Assignee.
This requirement ensures that Beehive Homes knows exactly who has a financial stake in the franchise and that control of the franchise does not become diluted or transferred to unknown parties without their consent. This protects Beehive Homes' interests by maintaining clarity and control over the ownership structure of its franchisees.
Furthermore, if any of the Shareholders, Partners, or Members are trustees or trusts, there are additional stipulations. The beneficial interests in those trusts cannot be assigned or transferred without Beehive Homes' prior written consent, and the trust agreements cannot be amended without their approval. Exhibit A must list all persons who are trustees or have beneficial interests in any Shareholder's, Partner's, or Member's trust. Beehive Homes also clarifies that the assignment does not constitute approval of any future transfers of equity interests to trust beneficiaries based on any condition. These conditions reinforce Beehive Homes' oversight and approval rights regarding any changes in ownership or control, even within trust structures.