Under Minnesota law, can Bombs Away unreasonably withhold consent to the transfer of a franchise?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- With respect to franchises governed by Minnesota law, the franchisor will comply with Minnesota Statutes, Section 80C.14, Subd. 3-5, which require (except in certain specified cases) (1) that a franchisee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the franchise agreement and (2) that consent to the transfer of the franchise will not be unreasonably withheld.
Source: Item 23 — RECEIPTS (FDD pages 36–117)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Minnesota Statutes, Section 80C.14, Subd. 3-5, dictates that Bombs Away cannot unreasonably withhold consent to the transfer of a franchise for franchises governed by Minnesota law. This provision aims to protect franchisees by ensuring they have the right to transfer their business to a qualified buyer without facing arbitrary obstacles from Bombs Away.
This protection is significant for prospective Bombs Away franchisees in Minnesota. It means that if a franchisee decides to sell their business, Bombs Away must have a legitimate, justifiable reason for refusing to approve a potential buyer. This prevents Bombs Away from blocking a transfer based on personal preferences or other non-business-related factors.
It is important for potential franchisees to understand what constitutes a "reasonable" basis for withholding consent. While the FDD states that consent cannot be unreasonably withheld, it does not define what specific reasons would be considered reasonable. A prospective franchisee should seek clarification from Bombs Away regarding the criteria they use to evaluate potential transferees to fully understand their rights and obligations under Minnesota law.