What actions constitute a 'Transfer' of a Buildingstars franchise?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
XIII. TRANSFERABILITY OF INTEREST
- B. By FRANCHISEE. BUILDINGSTARS has the right to reasonably disapprove any person or entity would have actual, legal or effective control over the Business and shall have the right to approve any Transfer. Consent to a Transfer shall not be deemed a waiver of BUILDINGSTARS' right to consent to any subsequent Transfers.
D. Right of First Refusal. Notwithstanding the foregoing, if FRANCHISEE receives a bona fide, executed, written offer to acquire an Interest from a responsible, fully disclosed purchaser, FRANCHISEE must submit a copy of the offer to BUILDINGSTARS. FRANCHISEE must also provide BUILDINGSTARS with any other information it requests to evaluate the offer. BUILDINGSTARS has the right, exercisable by delivering written notice to the FRANCHISEE within thirty (30) days from the date of last delivery to BUILDINGSTARS of the offer and any other documents requested by BUILDINGSTARS, to acquire the Interest for the price and on the terms and conditions contained in the offer. Regardless of the terms of the offer, however, BUILDINGSTARS may, in its discretion: substitute cash for any form of payment proposed in the offer; require the FRANCHISEE to include customary warranties and representations in the purchase agreement; and structure the transaction as an "asset purchase," rather than a "stock purchase." BUILDINGSTARS will not be obligated to pay any "finder's" or broker's fees that are a part of the proposed sale and shall not be obligated to comply with any part of the offer which directly or indirectly requires payment of any consideration other than a bona fide purchase price for the interest proposed to be transferred.
- C.
Death or Incapacity of FRANCHISEE.
FRANCHISEE, by will or other written instrument, may appoint a designated heir to continue operation of the Franchise Business, upon FRANCHISEE'S death.
Said designated heir must meet the qualifications of paragraph XIII.B.
No fee will be charged on a Transfer pursuant to this paragraph.
The Transfer of the FRANCHISEE'S Interest in this Agreement and in the Franchise Business to the FRANCHISEE'S heirs, personal representatives or conservators, as applicable, in the event of death or legal incapacity of the FRANCHISEE, shall not give rise to the BUILDINGSTARS' right of first refusal as set forth in paragraph XIII.D below, provided that the heirs, personal representatives or conservators, as applicable, meet BUILDINGSTARS' standards for new franchisees; execute the then-current form of Franchise Agreement; and, that a manager has, or within thirty days, shall have satisfactorily completed BUILDINGSTARS' Initial Training Program.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, a 'Transfer' of a franchise occurs when there is a sale, transfer, or change in ownership of the franchise. Buildingstars maintains the right to approve or disapprove of any person or entity that would have control over the business. Buildingstars' consent to one transfer does not waive its right to consent to any future transfers.
Specifically, if a Buildingstars franchisee receives a written offer to acquire their interest in the franchise from a purchaser, the franchisee must submit a copy of the offer to Buildingstars. Buildingstars then has the right to acquire the interest themselves, within 30 days of receiving the offer and any other requested documents. Buildingstars can modify the terms of the offer by substituting cash for other forms of payment, requiring customary warranties, and structuring the transaction as an asset purchase rather than a stock purchase. Buildingstars is not obligated to pay finder's fees or comply with any part of the offer that requires payment other than the purchase price for the interest being transferred.
In the event of the franchisee's death or incapacity, the franchisee may appoint a designated heir to continue operating the franchise business, provided that the heir meets Buildingstars' standards for new franchisees, executes the current franchise agreement, and ensures that a manager completes Buildingstars' initial training program within thirty days. No transfer fee will be charged in this case. This transfer to heirs does not give rise to Buildingstars' right of first refusal.