Is a pledge considered a transfer of the Belocal franchise agreement?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
For purposes of this Agreement, the term "transfer" shall mean any issuance, sale, assignment, gift, pledge, mortgage or any other encumbrance, transfer by bankruptcy, transfer by judicial order, merger, consolidation share exchange, or transfer by operation of law or otherwise, whether direct or indirect, voluntary or involuntary.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a pledge is considered a transfer of the franchise agreement. Belocal requires franchisee's to obtain prior written consent from the franchisor before any transfer or assignment of the agreement can occur.
The term "transfer" includes any issuance, sale, assignment, gift, pledge, mortgage, or any other encumbrance. It also encompasses transfers by bankruptcy, judicial order, merger, consolidation share exchange, or operation of law, whether direct or indirect, voluntary or involuntary. Any transfer without Belocal's consent is considered a breach of the agreement and will be rendered void.
If a franchisee wishes to transfer any interest in the franchised business, they must apply to Belocal for consent. The franchisee must provide all necessary information for Belocal to make a decision. Belocal has a reasonable period of time, not exceeding 30 days, to notify the franchisee of its decision after receiving all requested information.