Does Bombs Away have any restrictions on assigning the franchise agreement to another party?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in franchise or | Summary |
|---|---|---|
| m. Conditions for | § 15.2 | Pay transfer fee; buyer meets our standards; |
| franchisor’s approval of | ||
| transfer | buyer is not a competitor of ours; buyer and its owners sign our then-current franchise agreement and related documents (including personal guaranty); you’ve made all payments to us and are in compliance with all contractual requirements; buyer completes training program; you sign a general release; business complies with then-current system specifications. | |
| n. Franchisor’s right of | If you want to transfer your business (other | |
| first refusal to acquire | ||
| franchisee’s business | than to your co-owner or to your spouse, sibling, or child), we have a right of first refusal. | |
| k. “Transfer” by franchisee | For you (or any owner of your business) to | |
| - defined | voluntarily or involuntarily transfer, sell, or dispose of, in any single or series of transactions, (i) substantially all of the assets of the business, (ii) the franchise agreement, (iii) any direct or indirect ownership interest in the business, or (iv) control of the business. | |
| l. Franchisor’s approval of | No transfers without our approval. No transfers without our approval. | |
| transfer by franchisee | ||
| h. “Cause” defined--non- | Misrepresentation when applying to be a | |
| curable defaults | franchisee; knowingly submitting false information; bankruptcy; violation of law; violation of confidentiality; violation of non-compete; violation of transfer restrictions; slander or libel of us; refusal to cooperate with our audit or evaluation; cease operations for more than 15 consecutive days; three defaults in 12 months; cross-termination; conviction of, or plea to, a felony, commit or be accused of an act that is reasonably likely to materially and unfavorably affect our brand; any other breach of franchise agreement which by its nature cannot be cured. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 28–31)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, there are several restrictions regarding the transfer of a franchise agreement. Bombs Away must approve any transfer of the franchise by the franchisee.
Specifically, Bombs Away defines a transfer as any voluntary or involuntary action to transfer, sell, or dispose of the business assets, the franchise agreement itself, any ownership interest, or control of the business. Bombs Away also retains the right of first refusal if a franchisee wishes to transfer their business to anyone other than a co-owner, spouse, sibling, or child.
To gain approval for a transfer, the buyer must meet Bombs Away's standards, not be a competitor, and agree to the current franchise agreement and related documents, including a personal guarantee. The franchisee must also be current on all payments and contractual obligations, ensure the buyer completes the training program, sign a general release, and ensure the business complies with the current system specifications. Failure to comply with transfer restrictions is also grounds for termination of the franchise agreement.