What constitutes a 'Change of Control' in the context of a Benjamin Franklin Plumbing franchise transfer?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
The conditions set forth in this Section apply to a proposed transfer of this Agreement and/or substantially all of the assets of the Franchised Business, as well as to a proposed transfer, alone or together with other previous, simultaneous or proposed transfers, of any direct or indirect equity ownership interest in Franchisee that would result in a change of control of Franchisee or the Franchised Business ("Change of Control").
Source: Item 23 — RECEIPTS (FDD pages 88–312)
What This Means (2025 FDD)
According to the 2025 Benjamin Franklin Plumbing Franchise Disclosure Document, a 'Change of Control' occurs when there is a proposed transfer of the Franchise Agreement or substantially all of the assets of the franchised business. This also includes any transfer of direct or indirect equity ownership interest in the franchisee, whether alone or combined with other transfers, that would result in a change of control of the franchisee or the franchised business.
This definition is important for prospective franchisees because any transaction that meets this definition is subject to specific conditions and requires approval from Benjamin Franklin Plumbing. These conditions are detailed in Section 15.2 of the Franchise Agreement. Failing to comply with these conditions could result in the franchisor not approving the transfer.
It is important to note that even modifications to ownership that do not result in a 'Change of Control' still require advance notice to Benjamin Franklin Plumbing. These modifications include admitting a new owner, removing an existing owner, or changing the distribution of ownership. Benjamin Franklin Plumbing has the right to evaluate these proposed changes and may withhold consent or impose conditions, though the fees for such transfers are generally lower than those for a full 'Change of Control'.