What is considered a 'Transfer' of interest in the Black Bear Diner agreement?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
igned and transferred by Franchisor and, if so, shall be binding upon and inure to the benefit of Franchisor's successors and assigns; provided, however, that with respect to any assignment resulting in the subsequent performance by the assignee of the functions of Franchisor, the assignee shall assume the
obligations of Franchisor hereunder and Franchisor shall have no liability for the performance of any obligations contained in this Agreement after the effective date of such transfer or assignment.
7.2 By Developer
- 7.2.1 If Developer is a corporation, limited liability company, partnership, or limited liability partnership, each principal of Developer with at least a ten percent (10%) equity ownership interest in Developer ("Principal"), and the interest of each Principal in Developer, is identified in Exhibit C hereto. Developer represents and warrants that its owners are as set forth on Exhibit C attached to this Agreement, and covenants that it will not permit the identity of such owners, or their respective interests in Developer, to change without complying with this Agreement. Franchisor shall have the right to designate any person or entity which owns a direct or indirect interest in Developer as a Principal, and Exhibit C shall be so amended automatically upon notice thereof to Developer. Throughout the term of this Agreement, Franchisor shall have a continuing right to designate as a Principal any person or entity that owns a direct or indirect interest in Developer.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, if the Developer is a corporation, limited liability company, partnership, or limited liability partnership, each principal with at least a ten percent (10%) equity ownership interest is identified in Exhibit C. The Developer warrants that its owners are as set forth on Exhibit C and covenants that it will not permit the identity of such owners, or their respective interests in Developer, to change without complying with the Development Agreement.
Black Bear Diner retains the right to designate any person or entity which owns a direct or indirect interest in Developer as a Principal, amending Exhibit C automatically upon notice to the Developer. This right continues throughout the term of the Development Agreement.
Black Bear Diner enters into the Development Agreement based on the character, reputation, skill, attitude, business ability, and financial capacity of the Developer or its Principals, who will actively participate in the development, ownership, and operation of the Black Bear Diner restaurants. The Developer does not have the right to sublicense, subfranchise, resell, or otherwise transfer any interest in the Development Agreement or any Franchise Agreement.