What due diligence requests can the Bumper Man franchisor make of the proposed transferee?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) The proposed transferee (and its direct and indirect owners):
- (i) have sufficient business experience, aptitude, assets and financial resources to operate the Bumper Business;
- (ii) are individuals of good character and otherwise meet Franchisor's thenapplicable Standards for Bumper Man franchisees, including without limitation: (A) the proposed transferee must satisfy Franchisor's minimum net worth, liquid asset, equity/debt ratio and credit score requirements; (B) the proposed transferee must submit a complete and accurate franchise application and payment of all applicable fees; (C) the proposed transferee must complete and pass all background checks; (D) there must not be any felony convictions or other crimes of proposed transferee that may adversely affects the Marks, the System or the Franchisor, and there must not be a pleading of no contest to any other of these by the proposed transferee; (E) there have been no previous claims by the proposed transferee against another franchisor or affiliate; (F) the operation or ownership of the Bumper Business or proposed transferee's entity will not violate any contracts with any third party; and (G) the proposed transferee must not have a pattern or practice of litigiousness;
- (iii) are not engaged and will not engage in the operation or ownership of a Competitive Business, and will engage only in the operation of the Bumper Business; and
- (iv) will cooperate with reasonable due diligence requests made by Franchisor promptly thereafter and if additional time is reasonably needed, then prior to the proposed effective date of the Transfer. Franchisor may expand upon, and provide more details related to, the conditions for transfer and Franchisor's consent as described in this Section 16(c), and may do so in the Manual or otherwise in writing. Franchisor may, but is not obligated to, provide additional details regarding the transfer conditions and Franchisor's consent to Franchisee.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to the 2025 Bumper Man FDD, the franchisor can make reasonable due diligence requests of the proposed transferee. The proposed transferee must cooperate with these requests promptly. If additional time is reasonably needed, the transferee must cooperate prior to the proposed effective date of the transfer.
Specifically, Bumper Man will assess whether the proposed transferee has sufficient business experience, aptitude, assets, and financial resources to operate the Bumper Business. The franchisor also evaluates if the transferee meets the standards for Bumper Man franchisees.
These standards include satisfying minimum net worth, liquid asset, equity/debt ratio, and credit score requirements. The transferee must also submit a complete and accurate franchise application, pay all applicable fees, and complete and pass all background checks. Bumper Man also checks for felony convictions or other crimes that may adversely affect the brand, system, or franchisor. The transferee must also confirm they have no previous claims against another franchisor or affiliate, and that their operation or ownership will not violate any third-party contracts. Finally, the transferee must not have a pattern or practice of litigiousness.
Overall, these due diligence requests and standards ensure that any new Bumper Man franchisee is well-qualified and will maintain the brand's reputation and operational standards. Prospective franchisees should be prepared to provide comprehensive documentation and information to satisfy these requirements during the transfer process.