Is the Franchise Agreement with Bigfoot Forestry considered a personal services contract?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
- 19.2. By You. The rights and duties created by this Agreement are personal to you and the Owners. We are granting you franchise rights in reliance upon the character, skill, attitude, business ability and financial resources of you and your Owners. Because this Agreement is a personal services contract, neither you nor any Owner may engage in a Transfer (other than a Permitted Transfer) without our prior approval. Any Transfer (other than a Permitted Transfer) without our approval is void and constitutes a breach of this Agreement. We will not unreasonably withhold our approval of a proposed Transfer if all of the following conditions are satisfied:
- (a) we believe the proposed transferee has sufficient business experience, aptitude and financial resources to own and operate a Bigfoot Forestry Business and meets our minimum criteria for franchisees;
- (b) you and your affiliates and Owners are in full compliance with all Definitive Agreements;
- (c) the transferee's owners successfully complete, or make arrangements to attend, the initial training program and the transferee pays us any applicable training fee;
- (d) the transferee and its owners obtain all licenses and permits required by applicable Law to own and operate the Bigfoot Forestry Business;
- (e) the transferee: (i) agrees to guarantee and perform your obligations under this Agreement and
Source: Item 23 — RECEIPT (FDD pages 42–162)
What This Means (2025 FDD)
According to Bigfoot Forestry's 2025 Franchise Disclosure Document, the Franchise Agreement is indeed considered a personal services contract. This designation has significant implications for a franchisee, particularly concerning the transfer of rights and duties under the agreement. Bigfoot Forestry emphasizes that they are granting franchise rights based on the specific character, skills, attitude, business acumen, and financial stability of the franchisee and their owners. This focus on the personal attributes of the franchisee is why it is considered a personal services contract.
Because the Franchise Agreement is a personal services contract, franchisees and their owners face restrictions on transferring their rights and duties without prior approval from Bigfoot Forestry. Any transfer conducted without this approval is deemed void and constitutes a breach of the agreement. However, Bigfoot Forestry assures that they will not unreasonably withhold approval for a proposed transfer, provided certain conditions are met. These conditions include the proposed transferee demonstrating sufficient business experience, aptitude, and financial resources to successfully operate a Bigfoot Forestry Business, as well as meeting the franchisor's minimum criteria for franchisees.
Additional requirements for transfer approval include ensuring that the franchisee, their affiliates, and owners are in full compliance with all definitive agreements. The proposed transferee's owners must also successfully complete the initial training program, or make arrangements to attend it, and pay any applicable training fees. Furthermore, the transferee and their owners must obtain all necessary licenses and permits required by law to operate the Bigfoot Forestry Business. Finally, the transferee must agree to guarantee and fulfill the franchisee's obligations under the Franchise Agreement, ensuring continuity and adherence to the franchisor's standards. These stipulations ensure that any transfer maintains the integrity and quality of the Bigfoot Forestry franchise system.