Can the Stretch Zone Area Development Agreement be transferred?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Area Development Agreement | Summary |
|---|---|---|
| Area Development Agreement. You may not transfer the Area Development Agreement. | ||
| k. "Transfer" by you defined | Section 5.2 | Transfer means any sale, assignment, transfer, conveyance or gift of any direct or indirect interest in your Area Development Agreement. A transfer of less than 50% of the equity interests in Business Entity that signed the Area Development Agreement and a transfer to any other original owners of the Area Development Agreement is not considered a transfer. |
| l. Our approval of transfer by you m. Conditions for our | Section 5.2 Section 5.2 | You must obtain our prior written approval of any transfers. You may transfer the Area Development Agreement to a |
| approval of transfer | Business Entity you own but you continue to remain personally liable for all of your obligations under the |
Source: Item 17 — ITEM -17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 65–73)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the Area Development Agreement has some restrictions regarding its transfer. While it's generally stated that you may not transfer the Area Development Agreement, there are exceptions.
Specifically, Stretch Zone will allow you to transfer the Area Development Agreement to a business entity that you own. However, even if you transfer the agreement to your business entity, you will continue to remain personally liable for all obligations under the Area Development Agreement.
Furthermore, the FDD defines what constitutes a transfer. A transfer includes any sale, assignment, transfer, conveyance, or gift of any direct or indirect interest in your Area Development Agreement. However, a transfer of less than 50% of the equity interests in the Business Entity that signed the Area Development Agreement and a transfer to any other original owners of the Area Development Agreement is not considered a transfer.