Can a Byrider franchisee transfer the right to occupy the Business Location without the Company's approval?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
A. The Franchisee understands and acknowledges that the rights and duties this Agreement creates are personal to the Franchisee and its owners and that the Company has granted the Franchisee the franchise in reliance upon its perceptions of the Franchisee's and its owners' individual or collective character, skill, aptitude, attitude, business ability, and financial capacity. Accordingly, none of the following (each a "Transfer") may be transferred without the Company's prior written approval which will not be unreasonably withheld: (i) this Agreement (or any interest in this Agreement); (ii) the Franchisee's Business (or any right to receive all or a portion of the Franchisee's Business' profits or losses or capital appreciation related to the Franchisee's Business); (iii) the right to occupy the Business Location; (iv) substantially all of the assets of the
Franchisee's Business; (v) any ownership interest in the Franchisee (if the Franchisee is a legal entity); or (vi) any ownership interest in any of the Franchisee's owners (if such owners are legal entities). A transfer of the ownership, possession or control of the Franchisee's Business, or substantially all of its assets, may be made only with a transfer of the franchise granted under this Agreement. Any transfer without the Company's approval is a breach of this Agreement and has no effect.
A "transfer" shall not include a transfer of a deceased owner's ownership interest in Franchisee or Franchisee's owner to an existing owner so long as a new majority owner, if any, signs all documents a majority owner is required to sign under this Agreement.
- B.
In this Agreement, the term "Transfer" includes a voluntary, involuntary, direct, or indirect assignment, sale, gift, or other disposition.
An assignment, sale, gift, or other disposition includes the following events:
- (1) merger or consolidation or issuance of additional securities or other forms of ownership interest;
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, a franchisee cannot transfer the right to occupy the Business Location without prior written approval from Byrider. Byrider emphasizes that the rights and duties created by the franchise agreement are personal to the franchisee and its owners. Byrider grants the franchise based on their assessment of the franchisee's character, skills, business ability, and financial capacity.
This requirement means that if a franchisee wishes to transfer their right to occupy the Business Location, they must seek and obtain Byrider's approval. Byrider states that such approval will not be unreasonably withheld. This provision allows Byrider to maintain control over who operates at the Business Location and ensures that any new occupant meets their standards.
The FDD specifies that any transfer without Byrider's approval constitutes a breach of the franchise agreement and has no legal effect. This includes not only the transfer of the right to occupy the Business Location but also the transfer of the franchise agreement itself, the franchisee's business, or any ownership interest in the franchisee. The term "transfer" is broadly defined to include voluntary, involuntary, direct, or indirect assignments, sales, gifts, or other dispositions, including mergers, consolidations, and the issuance of additional securities.