What is the process for Bombs Away Franchising to exercise its right of first refusal for a proposed transfer?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- 15.5 Bombs Away Franchising's Right of First Refusal. Before Franchisee (or any Owner) engages in a Transfer (except under Section 15.3, or to a co-Owner, or to a spouse, sibling, or child of an Owner), Bombs Away Franchising will have a right of first refusal, as set forth in this Section. Franchisee (or its Owners) shall provide to Bombs Away Franchising a copy of the terms and conditions of any Transfer. For a period of 30 days from the date of Bombs Away Franchising's receipt of such copy, Bombs Away Franchising will have the right, exercisable by notice to Franchisee, to purchase the assets subject of the proposed Transfer for the same price and on the same terms and conditions(except that Bombs Away Franchising may substitute cash for any other form of payment). If Bombs Away Franchising does not exercise its right of first refusal, Franchisee may proceed with the Transfer, subject to the other terms and conditions of this Article.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away Franchising has a right of first refusal if a franchisee intends to transfer their franchise, with some exceptions. Before a franchisee engages in a transfer (except under Section 15.3, or to a co-Owner, or to a spouse, sibling, or child of an Owner), the franchisee must provide Bombs Away Franchising with a copy of the terms and conditions of the proposed transfer.
Bombs Away Franchising then has 30 days from the date they receive the copy of the transfer terms to exercise their right of first refusal. This is done by providing notice to the franchisee that Bombs Away Franchising will purchase the assets subject to the proposed transfer.
The purchase will be for the same price and on the same terms and conditions as the proposed transfer, except that Bombs Away Franchising can substitute cash for any other form of payment. If Bombs Away Franchising does not exercise its right of first refusal within the 30-day period, the franchisee can proceed with the transfer, subject to the other terms and conditions of the franchise agreement.