Under what conditions is a transfer not subject to Spray Net's first right of refusal?

According to Spray Net's 2025 Franchise Disclosure Document, there are specific conditions under which a transfer of ownership is not subject to the franchisor's right of first refusal. A transfer to an existing partner or shareholder is exempt, provided Spray Net gives prior written consent, which will not be unreasonably withheld. Similarly, a transfer resulting from the death, disability, or incapacitation of a shareholder or partner is also exempt from the right of first refusal, as long as it aligns with the provisions outlined in the franchise agreement.

Additionally, if the franchisee is a corporation or a limited liability company, a transfer of ownership shares or membership units is not subject to Spray Net's first refusal right, provided there is no change in control of the franchisee. This means that as long as the original ownership maintains control despite the transfer of shares or units, Spray Net will not exercise its right to first refusal.

These exceptions provide franchisees with some flexibility in transferring ownership under specific circumstances without requiring Spray Net to have the first option to purchase the interest. However, it's important to note that any material change in the terms of an offer for transfer will be considered a new proposal, which would then be subject to Spray Net's right of first refusal. Franchisees should ensure they meet all conditions and obtain the necessary written consent from Spray Net to avoid triggering the right of first refusal.