What is the condition for Extreme Art Studio Franchising, LLC's consent to the Requested Assignment?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
- Consent to Requested Assignment of Franchised Business. Franchisor hereby consents to the Requested Assignment of the Franchised Business from Former Franchisee to New Franchisee upon receipt of the Franchisor's Assignment Fee from Former Franchisee and the mutual execution of this Agreement by all parties. Franchisor waives its right of first refusal set forth in the Former Franchise Agreement.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, Extreme Art Studio Franchising, LLC consents to the assignment of a franchise from a former franchisee to a new franchisee if two conditions are met. First, the former franchisee must pay Extreme Art Studio the Transfer Fee, as required under the Franchise Agreement, also referred to as the Franchisor's Assignment Fee. Second, all parties involved, including the franchisor, former franchisee, and new franchisee, must mutually execute the Approval of Requested Assignment Agreement.
This means that if a franchisee wants to sell their Extreme Art Studio franchise to someone else, Extreme Art Studio Franchising, LLC has the right to approve the transfer. As part of this approval process, the former franchisee is responsible for paying a transfer fee to Extreme Art Studio. Additionally, all parties must sign an agreement formalizing the transfer.
It is important to note that Extreme Art Studio also waives its right of first refusal, meaning they will not exercise their right to purchase the franchise back before allowing the franchisee to sell to a third party. This process ensures that Extreme Art Studio maintains control over who becomes a franchisee and that they are compensated for the transfer of the franchise rights.