Conditions for Approval of Transfer. If Franchisee (and its owners) is in full compliance with this Agreement, then, subject to this Section 12.3’s other provisions: (a) Franchisor will approve the transfer of a non-controlling ownership interest in Franchisee if the proposed transferee and its owners are of good moral character, have no interest in and do not perform services for (and have no affiliates with an interest in or performing services for) a Competitive Business, otherwise meet Franchisor’s then-applicable standards for non-controlling owners of WING ZONE Restaurant franchisees, and sign Franchisor’s then-current form of Franchise Guaranty Agreement. References to a “controlling ownership interest” in Franchisee or one of its owners (if an entity) mean the percent of voting shares or other voting rights resulting from dividing one hundred percent (100%) of the ownership interests by the number of owners. In the case of a proposed transfer of an ownership interest in Franchisee or one of its owners, whether a “controlling ownership interest” is involved must be determined both immediately before and immediately after the proposed transfer to see if a “controlling ownership interest” will be transferred (because of the number of owners before the proposed transfer) or will be deemed to have been transferred (because of the number of owners after the proposed transfer). INITIALS: ______: ______ WING ZONE FA (FINAL 2021) FUTURE LABS IX, INC. EAST 30 (b) If the proposed transfer is of the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in Franchisee, or is one of a series of transfers (regardless of the timeframe over which these transfers take place) in the aggregate transferring the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in Franchisee, then Franchisor will not unreasonably withhold its approval if all of the following mandatory conditions are met (provided, however, there may be no such transfer until after the Franchised Restaurant has opened for business): (a) the transferee has the necessary business experience, aptitude, and financial resources to operate the Franchised Restaurant, (b) the transferee otherwise is qualified under Franchisor’s then-existing standards for the approval of new franchisees or of existing franchisees interested in acquiring additional franchises (including the transferee and its affiliates are in substantial operational compliance, at the time of the application, under all other franchise agreements for WING ZONE restaurants to which they then are parties with Franchisor), and (c) the transferee and its owners are not restricted by another agreement (whether or not with Franchisor) from purchasing the Franchised Restaurant or the ownership interest in Franchisee or the entity that owns a controlling ownership interest in Franchisee; (ii) Franchisee has paid all amounts owed to Franchisor and its affiliates, has submitted all required reports and statements, and is not in breach of any provision of this Agreement or another agreement with Franchisor or its affiliates relating to the Franchised Restaurant; (iii) neither the transferee nor any of its direct or indirect owners (if the transferee is an entity) or affiliates operates, has an ownership interest in, or performs services for a Competitive Business; (iv) the transferee (or its owner) and its management personnel (including managing owner), if different from Franchisee’s management personnel, satisfactorily complete Franchisor’s then-current initial training program;
Appears in 1 contract
Conditions for Approval of Transfer. If Franchisee you (and its your owners) is are in full substantial compliance with this Agreement, then, subject to the other provisions of this Section 12.3’s other provisions:
(a) Franchisor 12, we will approve a transfer that meets all of the requirements in this Subsection. Except as provided in Subsection 12.H. below, you need not obtain our approval of a transfer of a non-controlling ownership interest in Franchisee if you or your owners (determined as of the date on which the proposed transferee and its owners are transfer will occur), unless the owner of good moral character, have no interest in and do not perform services for (and have no affiliates with an interest in or performing services for) a Competitive Business, otherwise meet Franchisor’s then-applicable standards for the non-controlling owners ownership interest proposed to be transferred possesses actual management control of WING ZONE Restaurant franchiseesthe FACILITY’s operation (in which case the conditions specified below will apply). However, and any new owner of the non-controlling ownership interest must sign Franchisor’s then-current our form of Franchise Non-Monetary Guaranty and Assumption of Obligations, committing to comply with certain specified non-monetary obligations in this Agreement. References to a “If the new owner of the non-controlling ownership interest” interest (i) fails for any reason to sign the Non-Monetary Guaranty and Assumption of Obligations, or (ii) would be deemed to be in Franchisee or one of its owners (if an entity) mean the percent of voting shares or other voting rights resulting from dividing one hundred percent (100%) violation of the ownership interests by Non-Monetary Guaranty and Assumption of Obligations immediately upon its signing because of certain activities in which the number new owner then engages or has engaged, or (iii) has engaged in any dishonest, unethical, immoral, or similar conduct as a result of owners. In which his or her association with you and the case of FACILITY could, in our reasonable opinion, have a proposed transfer of an ownership interest in Franchisee or one of its ownersmaterial adverse effect on the goodwill associated with the Marks, whether a “controlling ownership interest” is involved must be determined both immediately before and immediately after the proposed transfer to see if a “controlling ownership interest” will the new owner may not be transferred (because of completed despite anything to the number of owners before the proposed transfer) or will be deemed to have been transferred (because of the number of owners after the proposed transfer)contrary contained in this Section 12. INITIALS: ______: ______ WING ZONE FA (FINAL 2021) FUTURE LABS IX, INC. EAST 30
(b) If the proposed transfer is of the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee you or in an entity owning Entity that owns a controlling ownership interest in Franchiseeyou, or is one of a series of transfers (regardless of the timeframe time period over which these transfers take place) that in the aggregate transferring the franchise rights granted by transfer this Agreement or a controlling ownership interest in Franchisee you or in an entity owning Entity that owns a controlling ownership interest in Franchiseeyou, then Franchisor will not unreasonably withhold its approval if all of the following mandatory conditions are must be met (provided, however, there may be no such transfer until after before or concurrently with the Franchised Restaurant has opened for business):proposed transfer’s effective date:
(a1) the transferee has the necessary business experience, aptitude, and financial resources to operate the Franchised RestaurantFACILITY;
(2) you have paid all Royalties, Fund contributions, and other amounts owed to us, our affiliates, and third party vendors; have submitted all required reports and statements; and have not violated any material provision of this Agreement, the Leases, or any other agreement with us during both the sixty (b60) day period before you requested our consent to the transfer and the period between your request and the transfer’s proposed effective date;
(3) neither the transferee nor its owners or affiliates have an ownership interest (direct or indirect) in or perform services for a Competitive Business, wherever located or operating;
(4) the transferee’s trained owner and operator (if different from your Trained Owner and Operator) satisfactorily complete required training within the timeframe we specify;
(5) your landlord allows you to transfer the Leases or sublease each Location to the transferee for the expected franchise term;
(6) the transferee otherwise shall (if the transfer is qualified under Franchisor’s then-existing standards for the approval of new franchisees or of existing franchisees interested in acquiring additional franchises (including the transferee and its affiliates are in substantial operational compliance, at the time of the application, under all other franchise agreements for WING ZONE restaurants to which they then are parties with Franchisorthis Agreement), and or you shall (c) if the transferee and its owners are not restricted by another agreement (whether or not with Franchisor) from purchasing the Franchised Restaurant or the transfer is of a controlling ownership interest in Franchisee you or the entity in an Entity that owns a controlling ownership interest in Franchiseeyou), sign our then current form of franchise agreement and related documents (“related documents” include the Guaranty and Assumption of Obligations and Non-Monetary Guaranty and Assumption of Obligations that the transferee’s principal and other owners must sign), any and all of the provisions of which, including the Territory definition and the Royalty and Fund contributions, may differ materially from any and all of those contained in this Agreement, provided, however, the term of the new franchise agreement signed will be equal to the initial term of KIDVILLE Facility franchises we then are granting;
(ii7) Franchisee has paid all amounts owed to Franchisor and its affiliatesyou or the transferee pays us a transfer fee, has submitted all required reports and statements, one-half (1/2) of which is due when you request approval of the transfer and is nonrefundable, whether or not the transfer actually occurs. The transfer fee depends on the nature of the transferee and the circumstances surrounding the transfer. The transfer fee is Five Thousand Dollars ($5,000) for each Location covered by this Agreement (in breach other words, Five Thousand Dollars ($5,000) for the Hub Location and a separate Five Thousand Dollars ($5,000) for each Annex Location) if the transferee (a) has been a KIDVILLE Facility franchisee for at least five (5) years as of any provision the transfer’s effective date, (b) has successfully held a managerial position at another KIDVILLE Facility, or (c) has obtained the interest proposed to be transferred due to the transferring owner’s death or disability. The transfer fee for all other transfers covered by this Subsection 12.C. (whether of this Agreement or another agreement with Franchisor or its affiliates relating to the Franchised Restauranta controlling ownership interest) shall be Forty-Five Thousand Dollars ($45,000);
(iii8) you (and, if applicable, your transferring owners) neither sign a general release, in a form satisfactory to us, of any and all claims against us and our owners, affiliates, officers, directors, employees, and agents (except for our indemnification obligations under Subsection 16.D. below);
(9) we have determined that the purchase price and payment terms will not adversely affect the transferee’s operation of the FACILITY;
(10) if you or your owners finance any part of the purchase price, you and/or your owners agree that all of the transferee’s obligations under promissory notes, agreements, or security interests reserved in the FACILITY are subordinate to the transferee’s obligation to pay Royalties, Fund contributions, and other amounts due to us, our affiliates, and third party vendors and otherwise to comply with this Agreement;
(11) (a) you have corrected any existing FACILITY deficiencies of which we have notified you on a punch-list or in other communications, and/or (b) the transferee nor any of its direct or indirect owners agrees (if the transferee transfer is an entityof this Agreement) or affiliates operatesto upgrade, has an ownership interest inremodel, or performs services and refurbish the FACILITY according to our then current requirements and specifications for a Competitive BusinessKIDVILLE Facilities within the time period we specify (consistent with Subsection 8.B. above) following the transfer’s effective date (we will advise the transferee, before the transfer’s effective date, of the specific actions that it must take and the time period within which it must do so);
(iv12) you and your transferring owners (and your owners’ spouses) will not, for two (2) years beginning on the transfer’s effective date, engage in any of the activities proscribed in Subsection 15.D. below; and
(13) you and your transferring owners will not directly or indirectly at any time or in any manner (except with respect to other KIDVILLE Facilities you lawfully own and operate) identify yourself or themselves in any business as a current or former KIDVILLE Facility or as one of our franchisees; use any Xxxx, any colorable imitation of a Xxxx, or other indicia of a KIDVILLE Facility in any manner or for any purpose; or utilize for any purpose any trade name, trade or service xxxx, or other commercial symbol that suggests or indicates a connection or association with us. You acknowledge that we have legitimate reasons to evaluate the qualifications of potential transferees and to analyze and critique the terms of their purchase contracts with you and that our contact with potential transferees to protect our business interests will not constitute improper or unlawful conduct. You expressly authorize us to investigate any potential transferee’s qualifications, to analyze and critique the proposed purchase terms, to communicate candidly and truthfully with the transferee (regarding the nature of your operation of the FACILITY, and to withhold consent to economically questionable transactions. You waive any claim that the action we take in good faith to protect our business interests in connection with a proposed transfer constitutes tortious interference with contractual or its owner) business relationships. Similarly, we may review all information regarding the FACILITY that you give the proposed transferee, correct any information that we believe is inaccurate, and its management personnel (including managing owner), if different from Franchisee’s management personnel, satisfactorily complete Franchisor’s then-current initial training program;give the transferee copies of any reports you have given us or we have made regarding the FACILITY.
Appears in 1 contract
Samples: Franchise Agreement (Longfoot Communications Corp.)
Conditions for Approval of Transfer. If Franchisee (Master Franchisor and its owners) shareholders, if Master Franchisor is a corporation, or its partners, if Master Franchisor is a partnership, are in full compliance with this AgreementAgreement in all material respects, then, subject to this Section 12.3’s other provisions:
(a) Franchisor will approve the transfer of a non-controlling ownership interest in Franchisee if the proposed transferee and its owners are of good moral character, have no interest in and do not perform services for (and have no affiliates with an interest in or performing services for) a Competitive Business, otherwise meet Franchisor’s then-applicable standards for non-controlling owners of WING ZONE Restaurant franchisees, and sign Franchisor’s then-current form of Franchise Guaranty Agreement. References to a “controlling ownership interest” in Franchisee or one of its owners (if an entity) mean the percent of voting shares or other voting rights resulting from dividing one hundred percent (100%) of the ownership interests by the number of owners. In the case of a proposed transfer of an ownership interest in Franchisee or one of its owners, whether a “controlling ownership interest” is involved must be determined both immediately before and immediately after the proposed transfer to see if a “controlling ownership interest” will be transferred (because of the number of owners before the proposed transfer) or will be deemed to have been transferred (because of the number of owners after the proposed transfer). INITIALS: ______: ______ WING ZONE FA (FINAL 2021) FUTURE LABS IX, INC. EAST 30
(b) If the proposed transfer is of the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in Franchisee, or is one of a series of transfers (regardless of the timeframe over which these transfers take place) in the aggregate transferring the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in Franchisee, then Franchisor will Company shall not unreasonably withhold its approval if of any transfer requested by Master Franchisor or its shareholders or partners, as appropriate. A transfer of any ownership interest in this Agreement may be made only in conjunction with a simultaneous transfer of a like interest in the Master Franchisor. Each transfer of all or any portion of, or interest in, this Agreement, the Franchise or the Master Franchisor, as appropriate, shall be subject to the satisfaction or waiver by the Company of all of the following mandatory conditions are met (providedprior to, howeveror concurrently with, there may be no such transfer until after the Franchised Restaurant has opened for business):effective date of the transfer:
(a1) the transferee has and each of its shareholders and partners shall demonstrate, to the necessary reasonable satisfaction of the Company, good character, business experience, aptitudecredit rating, and financial resources responsibilities to operate be able to satisfy the Franchised Restaurantobligations of the Master Franchisor under this Agreement, and will have sufficient equity capital in the Transferee to result in a debt-to-equity ratio as may be approved by the Company in the reasonable exercise of its discretion;
(b2) all accrued monetary obligations of Master Franchisor and its shareholders, if Master Franchisor is a corporation, or partners, if Master Franchisor is a partnership, to the transferee otherwise is qualified under Franchisor’s then-existing standards for the approval of new franchisees or of existing franchisees interested in acquiring additional franchises (including the transferee Company and its affiliates are or subsidiaries, incurred in substantial operational complianceconnection with this Agreement, the Master Fee, the Purchase Notes, or otherwise in connection with this Agreement or any Master Franchisor Center, and all other financial obligations to any financial institution, lender or other entity to whom the Company deems itself liable, in whole or in part, as a 41 guarantor, surety or otherwise for Master Franchisor have, at the time Company's election, been either assumed by the transferee or satisfied by Master Franchisor;
(3) if required, the lessor of the applicationpremises for any Master Franchisor Center shall consent to Master Franchisor's assignment of its lease for, under all other franchise agreements for WING ZONE restaurants or Sublease of, the Premises, in connection with the proposed transfer on terms and conditions which are acceptable to which they then are parties with Franchisor), and the Company;
(c4) the transferee and its owners shareholders or partners, as appropriate, shall have executed and agreed to be bound by this Agreement and such ancillary agreements as are then customarily used by the Company to grant franchises and/or Master Franchises for Sterling Optical Centers;
(5) the transferee shall pay to the Company, a transfer fee equal to Seven Hundred Fifty (US$750) Dollars multiplied by the number of Centers then in operation in the Territory;
(6) the transferee shall complete, to the reasonable satisfaction of the Company, the training then required by the Company for new franchisees and pay all costs and expenses relating thereto;
(7) the transferee or the transferor shall have paid to the Company all of its reasonable costs and expenses, including attorneys' and accountants' fees and expenses, as were incurred in connection with said transfer;
(8) Master Franchisor, and each of its shareholders, if Master Franchisor is a corporation, or its partners, if Master Franchisor is a partnership, shall execute a general release, in form and substance satisfactory to the Company, of any and all claims which any of them may have against the Company, its subsidiaries or affiliates, and each of their respective officers, directors, shareholders, employees and agents;
(9) the Company shall have approved the material terms and conditions of the transfer and shall have reasonably determined that the price and terms of payment are not restricted by another agreement (whether or not with Franchisor) from purchasing so burdensome as to adversely affect the Franchised Restaurant or future operations of the ownership interest in Master Franchisee or the entity that owns a controlling ownership interest in Franchiseetransferee's ability to perform all duties and obligations hereunder;
(ii10) the Company shall not have exercised its right of first refusal as set forth in Paragraph F of this Section 16;
(11) each transferor shall have entered into an agreement with the Company, in form and substance reasonably satisfactory to the Company, agreeing to subordinate to the payments to become due hereunder (and under all other documents exe- cuted in connection herewith), including, without limitation, the payment of Royalty Fees and Note payments, any obligations which any transferee may have to make any payments to the transferor; and
(12) if Master Franchisor requests the Company to assist Master Franchisor in finding a purchaser of the Master Franchisee has paid all amounts owed or this Agreement and the Company does find such a purchaser, then upon consummation of such purchase, Master Franchisor shall pay to Franchisor and its affiliatesthe Company a fee in an amount equal to six (6%) percent of the total purchase price, has submitted all required reports and statements, and is not in breach as compensation for services rendered by the Company. Consent by the Company to a transfer of any provision interest shall not constitute a waiver of any claims which the Company may have against the transferor, nor shall it be deemed a waiver by the Company of the right to demand exact compliance with any of the terms or conditions of this Agreement or another agreement with Franchisor or its affiliates relating to by the Franchised Restaurant;
(iii) neither the transferee nor any of its direct or indirect owners (if the transferee is an entity) or affiliates operates, has an ownership interest in, or performs services for a Competitive Business;
(iv) the transferee (or its owner) and its management personnel (including managing owner), if different from Franchisee’s management personnel, satisfactorily complete Franchisor’s then-current initial training program;transferee.
Appears in 1 contract
Conditions for Approval of Transfer. If Franchisee (and its owners) is in full compliance with this Agreement, then, subject to this Section 12.3’s other provisions:
(a) Franchisor will approve the transfer of a non-controlling ownership interest in Franchisee if the proposed transferee and its owners are of good moral character, have no interest in and do not perform services for (and have no affiliates with an interest in or performing services for) a Competitive Business, otherwise meet Franchisor’s then-applicable standards for non-controlling owners of WING ZONE Restaurant franchisees, and sign Franchisor’s then-current form of Franchise Guaranty Agreement. References to a “controlling ownership interest” in Franchisee or one of its owners (if an entity) mean the percent of voting shares or other voting rights resulting from dividing one hundred percent (100%) of the ownership interests by the number of owners. In the case of a proposed transfer of an ownership interest in Franchisee or one of its owners, whether a “controlling ownership interest” is involved must be determined both immediately before and immediately after the proposed transfer to see if a “controlling ownership interest” will be transferred (because of the number of owners before the proposed transfer) or will be deemed to have been transferred (because of the number of owners after the proposed transfer). INITIALS: ______: ______ WING ZONE FA (FINAL 2021) FUTURE LABS IX, INC. EAST 30
(b) If the proposed transfer Transfer is of the franchise rights granted by this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in FranchiseeControl, or is one of a series of transfers Transfers (regardless of the timeframe time period over which these transfers take placesuch Transfers occur) which in the aggregate transferring constitute the franchise rights granted by Transfer of this Agreement or a controlling ownership interest in Franchisee or in an entity owning a controlling ownership interest in Control of Franchisee, then Franchisor will not unreasonably withhold its approval approve a Transfer only if all of the following mandatory conditions are met (provided, however, there may be no such transfer until after prior to or concurrently with the Franchised Restaurant has opened for business):proposed effective date of the Transfer:
(a1) the Franchisee (and its Owners if Franchisee is not publicly traded) have paid all Royalty Fees and other amounts owed to Franchisor and its Affiliates, submitted all required reports and statements and otherwise are in full compliance with this Agreement.
(2) The proposed transferee has the necessary (and its direct and indirect owners): (i) have sufficient business experience, aptitude, aptitude and financial resources to operate the Franchised Restaurant, ; (bii) the transferee are individuals of good character and otherwise is qualified under meet Franchisor’s then-existing standards applicable Standards for Restaurant franchisees; (iii) are not engaged and will not engage in the operation or ownership of a Competitive Business, and will engage only in the operation of the Restaurant; and (iv) will cooperate with reasonable due diligence as requested by Franchisor prior to the proposed effective date of the Transfer.
(3) The transferee (or its owners) have agreed to complete Franchisor’s Initial Training program and provide Franchisor with a business plan for the approval Restaurant acceptable to Franchisor. Transferee must retain the Persons currently employed at the Restaurant in the positions identified in Section 12, and, if not employed as of new the effective date of the Transfer, Persons meeting the criteria for the positions set forth in Section 12 must be retained or employed in connection with the operation of the Restaurant during the Term and any replacement of such Person or position must satisfy the criteria in Section 12.
(4) The transferee (and its owners) has agreed to be bound by all of the terms and conditions of this Agreement and sign the ancillary documents Franchisor requires for Restaurant franchisees or of existing franchisees interested in acquiring additional franchises (including and their owners).
(5) Franchisee and the transferee (and its affiliates are in substantial operational compliance, at owners) have agreed to the time terms of a purchase and sale agreement for the Operating Assets and assumption of any lease of the application, under all other franchise agreements for WING ZONE restaurants to which they then are parties with Franchisor), premises and any applicable equipment.
(c6) the transferee and its owners are not restricted by another agreement (whether or not with Franchisor) from purchasing the Franchised Restaurant or the ownership interest in Franchisee or the entity that owns a controlling ownership interest in Franchisee;
(ii) Franchisee has paid all amounts owed transferee pays to Franchisor a Transfer Fee in connection with the Transfer, including the costs and its affiliates, has submitted all required reports and statements, and is not in breach expense of any provision of this Agreement or another agreement with Franchisor or its affiliates relating to the Franchised Restaurant;
(iii) neither the transferee nor any of its direct or indirect owners (if the transferee is an entity) or affiliates operates, has an ownership interest in, or performs services for a Competitive Business;
(iv) training the transferee (or its ownerowners) and its management personnel employees.
(including managing owner)7) Franchisee (and its transferring Owners if Franchisee is not publicly traded) and Franchisor have executed a general release, if different in form satisfactory to Franchisor, releasing each other from Franchisee’s management personnelany and all claims against each other and their shareholders, satisfactorily complete Franchisor’s then-current initial training program;officers, directors, employees and agents.
Appears in 1 contract
Samples: Franchise Agreement (Four Corners Property Trust, Inc.)
