Under what circumstances can Bw Premier Collection refuse to permit a transfer of ownership of a franchise?
Bw_Premier_Collection Franchise · 2025 FDDAnswer from 2025 FDD Document
- (g) A provision which permits a franchisor to refuse to permit a transfer or ownership of a franchise, except for good cause. This subdivision does not prevent a franchisor from exercising a right of first refusal to purchase the franchise. Good cause shall include, but is not limited to:
- (i) The failure of the proposed transferee to meet the franchisor's then current reasonable qualifications or standards.
- (ii) The fact that the proposed transferee is a competitor of the franchisor or subfranchisor.
- (iii) The unwillingness of the proposed transferee to agree in writing to comply with all lawful obligations.
- (iv) The failure of the franchisee or proposed transferee to pay any sums owing to the franchisor or to cure any default in the franchise agreement existing at the time of the proposed transfer.
Source: Item 23 — Receipts (FDD pages 54–203)
What This Means (2025 FDD)
According to the 2025 FDD, Bw Premier Collection can refuse a transfer of franchise ownership only for "good cause." This stipulation aims to protect both Bw Premier Collection's brand integrity and the interests of its franchisees. However, Bw Premier Collection retains the right of first refusal to purchase the franchise.
Good cause, allowing Bw Premier Collection to block a transfer, includes several specific scenarios. Firstly, if the proposed transferee does not meet Bw Premier Collection's then-current reasonable qualifications or standards, the transfer can be denied. Secondly, if the proposed transferee is a competitor of Bw Premier Collection or its subfranchisor, the transfer can be blocked. Thirdly, refusal can occur if the proposed transferee is unwilling to agree in writing to comply with all lawful obligations associated with the franchise agreement.
Finally, Bw Premier Collection can refuse a transfer if either the current franchisee or the proposed transferee has outstanding payments due to Bw Premier Collection or has failed to correct any existing defaults in the franchise agreement at the time of the proposed transfer. These conditions ensure that Bw Premier Collection maintains control over who joins their franchise system and that all financial and contractual obligations are met.