What is Deka Lash's definition of a 'Controlled Entity' in the context of franchise transfers?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
- 14.3 Transfer to a Controlled Entity. A "Controlled Entity" is an entity in which you are the beneficial owner of 100% of each class of voting ownership interest. A transfer to a Controlled Entity shall not trigger the Right of First Refusal, described in Section 14.6 below. At the time of the desired transfer of interest to a Controlled Entity, you must notify us in writing of the name of the Controlled Entity and the name and address of each officer, director, shareholder, member, partner, or similar person and their respective ownership interest. We do not charge a transfer fee for this change.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to Deka Lash's 2024 Franchise Disclosure Document, a 'Controlled Entity' is defined in the context of franchise transfers. Deka Lash specifies that a Controlled Entity is one in which the franchisee maintains complete ownership.
Specifically, the document states that the franchisee must be the beneficial owner of 100% of each class of voting ownership interest in the entity. This means the franchisee has total control over the entity's decisions and assets.
Notably, transferring the franchise to a Controlled Entity does not trigger Deka Lash's Right of First Refusal, which typically applies to other types of franchise transfers. To complete this type of transfer, the franchisee must notify Deka Lash in writing, providing the name of the Controlled Entity, the names and addresses of all officers, directors, shareholders, members, partners, or similar persons, and their respective ownership interests. Deka Lash does not charge a transfer fee for transfers to a Controlled Entity.