In the Ben Jerrys agreement, what constitutes a 'controlling' interest in an entity?

According to Ben Jerrys's 2025 Franchise Disclosure Document, a 'controlling' interest in an entity is defined as ownership of more than fifty percent (50%) of the equity or voting control of that entity. This definition is important because the franchisor places certain restrictions on ownership transfers.

For a prospective Ben Jerrys franchisee, this means that if you own more than 50% of the franchise entity, you are considered to have a controlling interest. Any transfer of this controlling interest is subject to the franchisor's approval, as Ben Jerrys wants to ensure that the new controlling party meets their standards for business skill, financial capacity, and personal character. This also applies to entities in which the franchisee owns a controlling interest.

This requirement allows Ben Jerrys to maintain standards across its franchise system by controlling who can own and operate a franchise. It is a fairly standard clause in franchise agreements to ensure brand consistency and protect the franchise system's overall integrity. Franchisees should be aware of these restrictions and plan accordingly if they anticipate changes in ownership or equity control.