What must a Crisp & Green franchisee do if they propose a change to their ownership structure?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
8.02 Disclosure of Ownership Interests. You and all of your Principal Owners represent, warrant and agree that Exhibit A is current, complete and accurate as of the Effective Date. You agree to promptly notify us of any proposed or intended change to your ownership structure during the Term, to obtain our approval in accordance with the transfer conditions of Section 13.02 below before initiating any such change, and to sign a then-updated and accurate form of Exhibit A (which will replace its predecessor version of Exhibit A) if we approve the change. Each person who is or becomes a Principal Owner must execute an agreement in form and substance as we then prescribe, undertaking to be bound jointly and severally by this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to the 2024 Crisp & Green Franchise Disclosure Document, if a franchisee intends to change their ownership structure during the term of the agreement, they must promptly notify Crisp & Green of the proposed change. Before initiating any such change, the franchisee must obtain approval from Crisp & Green, adhering to the transfer conditions outlined in Section 13.02 of the agreement.
If Crisp & Green approves the change, the franchisee is required to sign an updated and accurate version of Exhibit A, which will replace the previous version. This updated exhibit will reflect the new ownership structure. Additionally, each person who becomes a Principal Owner must execute an agreement, in a form and substance prescribed by Crisp & Green, committing to be jointly and severally bound by the Franchise Agreement.
These requirements ensure that Crisp & Green maintains control over the ownership and management of its franchises, protecting the brand and the integrity of the franchise system. By requiring notification, approval, and updated documentation, Crisp & Green can assess the suitability of the proposed changes and ensure that all Principal Owners are fully committed to the obligations of the Franchise Agreement. This process is typical in franchising, as franchisors need to maintain standards and protect their brand reputation.