Can a Bumble Roofing franchisee transfer their interest in the business without the franchisor's approval?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) No shares or interest in the capital of such corporation, limited liability company, partnership or other business entity shall be issued nor shall Franchisee directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, sell, assign, transfer, convey, donate, pledge, mortgage or otherwise encumber any such shares or interest or offer or attempt to do so or permit the same to be done without Franchisor's prior written consent;
- (c) The corporation shall maintain stop transfer instructions against the transfer of shares on its records subject to the restrictions of this Section and shall have all outstanding shares endorsed with the following legend printed conspicuously upon the face of each certificate:
"The transfer of this certificate is subject to the terms and conditions of a certain Franchise Agreement with BUMBLE ROOFING FRANCHISOR, LLC Reference is made to said Franchise Agreement and to the restrictive provisions of the articles of this corporation."
(d) The articles of incorporation, articles of organization, operating agreement, partnership agreement, shareholder agreement, and by-laws of the corporation, limited liability company, partnership or other business entity shall provide that its objectives or business is confined exclusively to the operation of the Business as provided for in this Agreement, and recite that the issuance and transfer of any shares, membership interest, partnership interest or other interest is restricted by the terms of this Agreement, and copies thereof shall be furnished to Franchisor upon request;
(e) Franchisor's consent to a transfer of any interest subject to the restrictions of this Section shall not constitute a waiver of any claim it may have against the assignor, nor shall it be deemed a waiver of Franchisor's right to demand exact compliance with any of the terms of this Agreement by the assignee;
(f) The corporation, partnership, limited liability company or other business entity shall advise Franchisor and keep Franchisor current as to the names and addresses of the directors, officers, members, partners and shareholder of and those persons financially involved in the corporation, partnership, limited liability company or other business entity; and
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to the 2025 Bumble Roofing Franchise Disclosure Document, a franchisee cannot transfer interest in the business without prior written consent from Bumble Roofing. This restriction applies to shares or interests in the capital of a corporation, limited liability company, partnership, or other business entity. The franchisee cannot directly or indirectly sell, assign, transfer, convey, donate, pledge, mortgage, or otherwise encumber any such shares or interest without Bumble Roofing's approval.
To ensure compliance, Bumble Roofing requires that stop transfer instructions are maintained against the transfer of shares and that all outstanding shares are endorsed with a specific legend. This legend indicates that the transfer of the certificate is subject to the terms and conditions of the Franchise Agreement with Bumble Roofing Franchisor, LLC. The articles of incorporation or similar documents must also state that the business's objectives are confined to operating the Bumble Roofing business as outlined in the agreement and that any transfer of interest is restricted by the agreement's terms.
Bumble Roofing's consent to a transfer does not waive any claims it may have against the assignor, nor does it waive Bumble Roofing's right to demand compliance with the agreement's terms by the assignee. The franchisee must also keep Bumble Roofing informed about the names and addresses of directors, officers, members, partners, shareholders, and those financially involved in the business entity. This ensures that Bumble Roofing maintains oversight and control over who is involved in operating a Bumble Roofing franchise.
This requirement is typical in franchising, as franchisors want to control who becomes part of their system to protect the brand and ensure consistent operations. A prospective Bumble Roofing franchisee should carefully consider these restrictions and understand the process for obtaining franchisor approval before considering any transfer of ownership or interest in the franchise.