Under what conditions is a Buildingstars franchisee permitted to grant a security interest or lien upon their interest in the agreement or business assets?

Based on the 2025 Buildingstars Franchise Disclosure Document, the document does not explicitly state the conditions under which a franchisee is permitted to grant a security interest or lien upon their interest in the agreement or business assets. The FDD excerpts focus on various other aspects of the franchise agreement, such as the initial fees, the rights and obligations of both the franchisor and franchisee, termination conditions, and the independent contractor relationship.

Item XIII discusses the franchisee's ability to assign the agreement, stating that the franchisee may not assign the agreement without Buildingstars' consent, which will not be unreasonably withheld. This section defines assignment as including any situation in which a person or entity would have actual, legal, or effective control over the business or upon a sale, transfer, or change of ownership of the franchisee or the business. However, this does not directly address the granting of a security interest or lien.

Given the absence of specific details regarding security interests or liens, it is important for a prospective Buildingstars franchisee to seek clarification from the franchisor regarding this matter. Understanding the conditions under which a franchisee can encumber their interest in the franchise is crucial for financial planning and business management. A potential franchisee should ask Buildingstars directly about their policy on granting security interests or liens and whether there are any restrictions or requirements in place.