Must a Buildingstars franchisee be in compliance with all agreements to transfer their franchise?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Prior Compliance. The FRANCHISEE has performed its obligations and duties under this Agreement and FRANCHISEE is not in default under this Agreement, or any other agreement with BUILDINGSTARS;
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Payments.
The transferor has satisfied all of its monetary obligations to BUILDINGSTARS, BUILDINGSTARS' Affiliates and suppliers under this Agreement and all other agreements it has with BUILDINGSTARS;
Release.
The FRANCHISEE, including all officers, directors and shareholders (as well as all guarantors under this Agreement) must execute a general release, in the form which we approve, of any and all claims against BUILDINGSTARS, BUILDINGSTARS' Affiliates, and their respective officers, directors, employees and agents;
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, a franchisee must be in compliance with all agreements to transfer their franchise. Buildingstars will approve a transfer if the franchisee has performed all obligations and duties under the Franchise Agreement and is not in default under the agreement or any other agreement with Buildingstars.
In addition, the transferor must have satisfied all monetary obligations to Buildingstars, its affiliates, and suppliers under the Franchise Agreement and all other agreements with Buildingstars. The franchisee, including all officers, directors, shareholders, and guarantors, must execute a general release of all claims against Buildingstars and its affiliates.
These conditions ensure that Buildingstars maintains control over who becomes a franchisee and that the brand's reputation is protected. It also protects Buildingstars from potential liabilities related to the previous franchisee's operation of the business. Prospective franchisees should carefully review all agreements and ensure they are in full compliance before attempting to transfer their franchise.