If Buildingstars withholds approval of a proposed transfer, what must Buildingstars do?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
Although BUILDINGSTARS will not be required to determine the value of business upon a Transfer, if in BUILDINGSTARS' reasonable judgment, the purchase price or terms of the sale are not economically feasible to the proposed assignee, BUILDINGSTARS can withhold its consent to such an assignment or Transfer.
Further, BUILDINGSTARS may, in good faith, notify FRANCHISEE, stating the reasons that BUILDINGSTARS has elected to withhold approval of the proposed Transfer.
Notwithstanding the foregoing, BUILDINGSTARS' approval of the Transfer shall not be deemed to imply or warrant that the purchase price or terms of sale are economically feasible, and BUILDINGSTARS hereby disclaims any responsibility for making any such determination.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, Buildingstars is not required to determine the value of the business upon a transfer. However, if Buildingstars, in its reasonable judgment, believes that the purchase price or terms of the sale are not economically feasible for the proposed assignee, Buildingstars can withhold its consent to the transfer.
In such cases where Buildingstars withholds approval, Buildingstars may, in good faith, notify the franchisee, stating the reasons for withholding approval of the proposed transfer. This notification provides the franchisee with an understanding of why the transfer was not approved, which could be related to the financial viability of the transaction for the potential buyer.
It is important to note that Buildingstars' approval of a transfer does not imply any warranty or assurance that the purchase price or terms of sale are economically feasible. Buildingstars explicitly disclaims any responsibility for making such a determination, placing the onus on the franchisee and the transferee to assess the economic viability of the transfer independently.