What constitutes a 'Permitted Transfer' of ownership in a Bigfoot Forestry Development Business?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
directly or indirectly through one or more intermediaries owns an Equity Interest in the Development Business or Developer Entity; (c) the Person directly signs a Franchise Agreement as the franchisee, either alone or in conjunction with one or more other Persons; and/or (d) the Person directly or indirectly through one or more intermediaries owns an Equity Interest in any affiliate of yours that executes a Franchise Agreement as authorized by §6.
- "Permitted Transfer" means a Transfer: (a) between existing Owners; (b) by the Owners to a new Developer Entity for which such Owners collectively own and control 100% of the Equity Interests; or (c) of less than 20% of the Equity Interests in the Development Business or Developer Entity; provided, however, that a Permitted Transfer does not include any Transfer that results in the Managing Owner owning less than 20% of the Equity Interests in the Development Business or Developer Entity.
- "Term" means the period of time beginning on the Effective Date of this Agreement and expiring on the earlier to occur of: (a) the opening date listed in the Development Schedule for the last Bigfoot Forestry Business you are required to open;
Source: Item 23 — RECEIPT (FDD pages 42–162)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, a 'Permitted Transfer' refers to specific ownership changes that can occur without requiring the franchisor's prior approval. These include transfers between existing owners, transfers to a new Developer Entity where the original owners maintain 100% ownership and control, or transfers of less than 20% of the Equity Interests in the Development Business or Developer Entity. However, even these transfers have a condition: the Managing Owner must still retain at least 20% of the Equity Interests.
While Bigfoot Forestry does not require prior approval for Permitted Transfers, the franchisee must still provide the franchisor with at least 10 days' prior notice. Additionally, if the transfer results in a new Developer Entity, Bigfoot Forestry can request the former Developer Entity to sign a corporate guarantee to secure the new entity's financial obligations under all Definitive Agreements.
Furthermore, the franchisee and any involved parties must sign all documents that Bigfoot Forestry reasonably requests to facilitate and document the Permitted Transfer. This ensures that Bigfoot Forestry is kept informed and that the transfer is properly recorded, even though prior approval is not mandated for these specific types of ownership changes. This is a fairly standard practice in franchising, allowing for some flexibility in ownership structure while still protecting the franchisor's interests.