What is the timeframe for Hyper Kidz to accept or decline the offer to purchase the business?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.3 Except as provided in Section 11.2, if you receive from an unaffiliated third party and desires to accept a bona fide written offer to purchase your business, Development Rights and interests, we shall have the option, exercisable within thirty (30) days after receipt of written notice setting forth the name and address of the prospective purchaser, the price and terms of such offer, and a copy of such offer and the other information stated in this Section 11.3, to purchase such business, Development Rights and interests, including your right to develop sites within the Development Area, on the same terms and conditions as offered by said third party.
In order that we may have information sufficient to enable us to determine whether to exercise this option, we may require you to deliver to us certified financial statements as of the end of your most recent fiscal year and such other information about your business and operations as we may request.
If we decline, or do not accept the offer in writing within thirty (30) days, you may, within thirty (30) days from the expiration of the option period, sell, assign and transfer your business, Development Rights and interest to said third party, provided we have consented to such transfer as required by this Section 11.
Any material change in the terms of the offer prior to closing of the sale to such third party shall constitute a new offer, subject to the same rights of first refusal by us or our nominee, as in the case of an initial offer.
Source: Item 23 — RECEIPTS (FDD pages 52–205)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, if a franchisee receives a legitimate written offer from an unaffiliated third party to purchase their Hyper Kidz business, development rights, and interests, Hyper Kidz has the option to purchase the business on the same terms. Hyper Kidz has thirty (30) days to exercise this option.
To make an informed decision, Hyper Kidz may request certified financial statements and other information about the franchisee's business operations. This allows Hyper Kidz to assess the offer and the potential purchaser before making a decision.
If Hyper Kidz declines the offer or does not accept it in writing within the 30-day period, the franchisee has another 30 days to sell, assign, and transfer their business, development rights, and interests to the third party, provided that Hyper Kidz has consented to the transfer. Any material changes to the terms of the offer before the sale closes constitute a new offer, which would again be subject to Hyper Kidz's right of first refusal.
This right of first refusal ensures that Hyper Kidz maintains control over who enters their system and protects the brand's integrity. It also allows Hyper Kidz to expand its corporate operations by acquiring existing franchise locations if it deems it beneficial.