What happens if the Bombs Away Principal Executive transfers his/her interest in the Franchisee?

According to Bombs Away's 2024 Franchise Disclosure Document, if the Principal Executive transfers his/her interest in the Franchisee, the Franchisee must promptly designate a new Principal Executive. This new executive is subject to Bombs Away Franchising's reasonable approval. The Principal Executive is the person primarily responsible for the Bombs Away business and has decision-making authority on behalf of the Franchisee. This person must also have at least a 10% ownership interest in the Franchisee and participate in the direct operation of the business, devoting substantial time and attention to it.

This requirement ensures that Bombs Away maintains a consistent level of operational control and that a qualified individual is always managing the franchise. The approval process allows Bombs Away to vet the new Principal Executive to ensure they meet the brand's standards and have the necessary expertise to run the business effectively. This is a common practice in franchising, as franchisors want to protect their brand and ensure that franchisees are capable of upholding the brand's reputation.

For a prospective Bombs Away franchisee, this means that if the person initially designated as the Principal Executive leaves the business or transfers their interest, a suitable replacement must be found and approved by Bombs Away. This could involve a search for a qualified candidate and the presentation of their credentials to Bombs Away for review. Failure to promptly designate a new, approved Principal Executive could potentially lead to a breach of the franchise agreement.