Can a Closet Storage Concepts franchisee change their designated manager without approval?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee's rights under this Agreement are personal, and if Franchisee is an individual, Franchisee shall not change, sell, transfer, assign or encumber his/her/their percentage of ownership interest in this Agreement or the Franchised Business, without the prior written consent of Franchisor. Any unauthorized transfer by Franchisee shall constitute a material breach of the Agreement and shall be voidable by Franchisor. If Franchisee is an entity, Section 7.3 shall govern.
- 7.2 Death or Disability. In the event of the death, disability or incapacity of any individual Franchisee or officer or director or member of an incorporated Franchisee or limited liability company or partner of a partnership Franchisee, should the decedent's or disabled or incapacitated person's executor, heir or legal representative, or the business entity, as the case may be, wish to continue as Franchisee under this Agreement, such person shall apply for Franchisor's consent, execute the then-current franchise agreement, and complete the training program to Franchisor's satisfaction, as applicable, as in any other case of a proposed transfer of Franchisee's interest in this Agreement. Such assignment by operation of law shall not be deemed in violation of this Agreement, provided the heirs or legatees or business entity meet the conditions imposed by this Agreement and are acceptable to Franchisor.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISED BUSINESS (FDD pages 43–44)
What This Means (2025 FDD)
Based on the 2025 Closet Storage Concepts Franchise Disclosure Document, the franchisee's ability to change their designated manager without approval is not explicitly addressed. However, the document does state that if the franchisee is an individual, they cannot "change, sell, transfer, assign or encumber his/her/their percentage of ownership interest in this Agreement or the Franchised Business, without the prior written consent of Franchisor." This suggests that any significant changes to the ownership or control of the franchise require the franchisor's approval.
Furthermore, in the event of the death, disability, or incapacity of an individual franchisee or an officer, director, or member of a business entity franchisee, the successor must apply for the franchisor's consent and meet certain conditions to continue as a franchisee. This highlights the franchisor's interest in maintaining consistent and qualified management within the franchise system.
Given the lack of specific information about changing a designated manager, it is important for a prospective franchisee to seek clarification from Closet Storage Concepts regarding the process and requirements for changing a designated manager. Understanding the franchisor's policies on this matter is crucial for ensuring smooth operations and compliance with the franchise agreement.