What information requirements does Crisp & Green impose on proposed transferees and their Principal Owners?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
- (j) if you (or any of your Principal Owners or Affiliates) finance any part of the sale price of the transferred interest, you and/or your Principal Owners or Affiliates must agree that all
obligations of the transferee, and security interests reserved by any of them in the assets of the Franchised Restaurant, will be subordinate to the transferee's obligations to pay all amounts due us and our Affiliates and to otherwise comply with this Agreement or the new franchise agreement executed by the transferee;
(k) you (and your Immediate Family) will not, for two (2) years beginning on the transfer's effective date, engage in any of the activities proscribed in Section 16.03 below; and
(l) you and your Principal Owners and Affiliates must execute such other documents and do such other things as we may reasonably require to protect our rights under this Agreement and under any development agreement.
13.03 Effect of Approval.
Our approval of a Transfer of the Franchise does not constitute: (a) a representation as to the fairness of the terms of any agreement or arrangement between you or your Principal Owners and the transferee or as to the prospects of success of the Franchised Restaurant by the transferee; or (b) a release of you and your Principal Owners, a waiver of any claims against you or your Principal Owners or a waiver of our right to demand the transferee's exact compliance with this Agreement.
Any approval shall apply only to the specific Transfer of the Franchise being proposed and shall not constitute an approval of, or have any bearing on, any other Transfer of the Franchise.
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 or their Principal Owners or Affiliates finance any part of the sale price of the transferred interest, they must agree that all obligations of the transferee and security interests reserved by any of them in the assets of the Franchised Restaurant will be subordinate to the transferee's obligations to pay all amounts due to Crisp & Green and its Affiliates. This also includes compliance with the Franchise Agreement or the new franchise agreement executed by the transferee.
Furthermore, the franchisee, along with their Immediate Family, must not engage in any activities proscribed in Section 16.03 for two years following the transfer's effective date. Additionally, the franchisee, their Principal Owners, and Affiliates must execute other documents and perform other actions that Crisp & Green may reasonably require to protect its rights under the Franchise Agreement and any development agreement.
Crisp & Green's approval of a transfer does not represent the fairness of the terms between the franchisee (or their Principal Owners) and the transferee, nor does it guarantee the success of the Franchised Restaurant by the transferee. The approval also does not release the franchisee and their Principal Owners from any claims or waive Crisp & Green's right to demand exact compliance with the agreement from the transferee. Any approval applies only to the specific transfer being proposed and does not affect any other transfer of the franchise. These stipulations ensure that Crisp & Green maintains control over its brand and operations even when a franchise changes hands.