What can Bft Franchisor require Franchisee to send regarding a possible transaction?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee (or any of its owners) desire to engage in a Transfer, Franchisee (or its owners) agree to obtain from a responsible and fully disclosed buyer, and send to Franchisor, a true and complete copy of a bona fide, executed written offer (which may include a letter of intent) relating exclusively to an interest in Franchisee or in this Agreement and the Studio. The offer must include details of the payment terms of the proposed sale and the sources and terms of any financing for the proposed purchase price. To be a valid, bona fide offer, the proposed purchase price must be in a dollar amount, and the proposed buyer must submit with its offer an earnest money deposit equal to five percent (5%) or more of the offering price. The right of first refusal process will not be triggered by a proposed Transfer that would not be allowed under Sections 14.1 and 14.2 above. Franchisor may require Franchisee (or its owners) to send to Franchisor copies of any materials or information sent to the proposed buyer or transferee regarding the possible transaction.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, if a franchisee desires to engage in a transfer of their franchise, Bft may require the franchisee (or its owners) to send copies of any materials or information sent to the proposed buyer or transferee regarding the possible transaction.
Specifically, the franchisee must obtain a bona fide, executed written offer from a responsible and fully disclosed buyer. This offer must exclusively relate to an interest in the franchisee, the Franchise Agreement, or the Bft studio itself. The offer needs to include detailed payment terms and the sources and terms of any financing for the proposed purchase price. To be considered valid, the proposed purchase price must be a specific dollar amount, and the buyer must submit an earnest money deposit of at least five percent (5%) of the offering price with their offer.
This requirement ensures that Bft has access to all the information provided to a potential buyer, allowing them to make an informed decision when exercising their right of first refusal. It also helps Bft maintain control over who enters the franchise system and ensures that any potential new franchisee meets their standards. This is a fairly standard practice in franchising, as franchisors typically want to vet potential new owners to protect their brand and system standards.