Can Itan terminate the agreement if the franchisee makes an unauthorized Transfer?

ies created by this Agreement are personal to you and the Owners. We are granting you franchise rights in reliance upon the character, skill, attitude, business ability and financial resources of you and your Owners. Because this Agreement is a personal services contract, neither you nor any Owner may engage in a Transfer (other than a Permitted Transfer) without our prior approval. Any Transfer (other than a Permitted Transfer) without our approval is void and constitutes a breach of this Agreement. We will not unreasonably withhold our approval of a proposed Transfer if all of the following conditions are satisfied:

• (a) we believe the proposed transferee has sufficient business experience, aptitude and financial resources to own and operate a Salon and meets our minimum criteria for franchisees;
• (b) you and your affiliates and Owners are in full compliance with all Definitive Agreements;
• (c) the transferee's owners successfully complete, or make arrangements to attend, the initial training program and the transferee pays any applicable training fee (the transfer fee covers training for one (1) Person);
• (d) your landlord consents to the assignment of your lease to the transferee, or the transferee is diligently pursuing an approved substitute location within the Site Selection Area;
• (e) the transferee and its owners obtain all licenses and permits required by applicable Law to own and operate the Salon;
• (f) the transferee: (i) agrees to discharge and guarantee your obligations under this Agreement and any other Business contracts (including customer contracts/obligations and supplier contracts); and (ii) signs any agreement we require to confirm the foregoing;
• (g) the transferee and its owners sign our then-current form of franchise agreement (unless we instruct you to assign this Agreement to the transferee) except that: (i) the Term and renewal term(s) shall be the Term and renewal term(s) remaining under this Agreement unless we specify otherwise; and (ii) the transferee need not pay a separate initial franchise fee;
• (h) the transferee agrees to remodel the Salon and upgrade all furniture, fixtures and equipment to conform to our then-current standards and specifications (these changes must be completed within 12 months after the Transfer or such shorter period of time we specify);
• (i) you or the transferee pay us a $10,000 transfer fee to defray expenses we incur related to the Transfer (in addition to the transfer fee, you must reimburse us for any commission we pay our broker if our broker finds the transferee);
• (j) you and your Owners sign a General Release;
• (k) you agree to subordinate the transferee's financial obligations to you to the transferee's financial obligations owed to us pursuant to the franchise agreement (we may require you to enter into a written subordination agreement);
• (l) we choose not to exercise our right of first refusal described in §19.5; and
• (m) you or the transferring Owner, as applicable, and the transferee satisfy all other conditions we reasonably require as a condition to approval of the Transfer.

Our consent to a Transfer shall not constitute a waiver of any Claims we have against the transferor or our right to demand the transferee comply with all terms of the franchise agreement.

• 19.3. Permitted Transfers. You may engage in a Permitted Transfer without our prior approval, but you must: (a) give us at least 10 days' prior notice; and (b) upon our request, cause

Source: Item 23 — RECEIPT (FDD pages 44–190)