What specific actions constitute 'transferring an interest' in the Bumble Roofing business?
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;
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to Bumble Roofing's 2025 Franchise Disclosure Document, transferring an interest in the franchise business involves several specific actions related to the ownership and control of the business entity. These actions require the franchisor's prior written consent.
The FDD states that no shares or interest in the capital of a corporation, limited liability company, partnership, or other business entity should be issued. Additionally, the franchisee cannot directly or indirectly, voluntarily or involuntarily, sell, assign, transfer, convey, donate, pledge, mortgage, or otherwise encumber any such shares or interest. Offering or attempting to perform any of these actions, or permitting them to be done without Bumble Roofing's prior written consent, also constitutes a transfer of interest.
These restrictions are put in place to ensure that Bumble Roofing maintains control over who is involved in the operation of its franchises and to protect the brand's integrity. The corporation must also maintain stop transfer instructions against the transfer of shares on its records and include a legend on all outstanding shares indicating that the transfer is subject to the terms and conditions of the Franchise Agreement. This ensures that any potential buyer is aware of these restrictions.
The articles of incorporation, articles of organization, operating agreement, partnership agreement, shareholder agreement, and by-laws of the business entity must also state that its objectives are confined exclusively to the operation of the Bumble Roofing business. These documents must also state that the issuance and transfer of any shares, membership interest, partnership interest, or other interest is restricted by the terms of the Franchise Agreement. Copies of these documents must be provided to Bumble Roofing upon request. These measures ensure that the franchise operates according to the franchisor's standards and that any changes in ownership or control are subject to their approval.