Are there any exceptions to the requirement for Beem Light Sauna's consent to a transfer?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
- 13.7 Permitted Transfers.
The other provisions in this Section do not apply, including our right of first refusal and right of approval, to the following Transfers:
- (a) Security Interests.
You may grant, without obtaining our consent, a security interest in the Site (if you own the Site), the Studio, or any Operating Assets to a financial institution or other party that provided or provides any financing for your acquisition, development, and/or operation of the Studio, but you may not grant a security interest in this Agreement.
Any foreclosures or other exercise of the rights granted under any security interest are subject to all applicable terms and conditions of this Section 13.
For the avoidance of doubt, in no event shall any secured party be entitled to (i) use on your or their behalf, or receive an assignment of your License to use, the Intellectual Property under this Agreement or (ii) use, assign, possess, or have access to the Proprietary Information.
- (b) Transfer to a Revocable Trust.
Any Owner who is an individual may Transfer his or her ownership interest in you (or any of your Owners that is an Entity) to a revocable trust that he or she establishes for estate planning purposes, as long as he or she (i) is a trustee of the trust, (ii) controls the exercise of the rights in you (or your Owner) held by the trust, and (iii) has the right to revoke the trust.
You must provide us with advance written notice of such proposed Transfer and copies of the trust documentation that demonstrates your compliance with this provision at least 30 days before the Transfer's anticipated effective date.
Dissolution of, or transfers from, any trust described in this Section 13.7(b) are subject to all applicable terms and conditions of this Section 13.
Source: Item 23 — RECEIPT (FDD pages 71–230)
What This Means (2025 FDD)
According to Beem Light Sauna's 2025 Franchise Disclosure Document, while the franchisee typically needs prior written consent from Beem Light Sauna for any transfer of the franchise agreement or license, there are specific exceptions outlined in Section 13.7. These 'Permitted Transfers' do not require the franchisor's right of first refusal or approval.
One exception is granting a security interest in the site (if owned), the studio, or operating assets to a financial institution that provides financing for the studio's acquisition, development, or operation. However, a security interest cannot be granted in the franchise agreement itself. Additionally, any foreclosure or exercise of rights under the security interest remains subject to the terms and conditions of Section 13. The secured party is not entitled to use the intellectual property or proprietary information associated with the Beem Light Sauna franchise.
Another exception involves an individual owner transferring their ownership interest to a revocable trust established for estate planning purposes, provided they meet certain conditions. The owner must be a trustee of the trust, control the rights held by the trust, and have the right to revoke the trust. Beem Light Sauna requires advance written notice and copies of the trust documentation at least 30 days before the transfer. Transfers from such a trust are subject to the terms of Section 13. These exceptions provide franchisees with some flexibility in managing their business and personal assets without requiring franchisor approval for specific transfer scenarios.