Franchising And Prohibited Transfers
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The article "Franchising and Prohibited Transfers" talks about entrepreneurialism, it was created by Lance Winslow.
In the world of franchising often be franchise outlet or franchisee will wish to sell their rights under the franchise agreement to a second party. Since this is a common occurrence amongst franchisees it makes sense to have a clearly defined franchise agreement, which addresses potential or problematic transfers. A franchisor may wish to have a clause in the franchise agreement, which actually prhoibits certain types of franchise transfers.
And there might be a number of reasons for this.
Below is a clause that I put into our franchise agreements all prohibited transfers;5.2.6 Prohibited TransfersFor purposes of this Section 5.2, without limiting the generality of the foregoing, Franchisor’s withholding of consent will be considered reasonable if the proposed sale, assignment, transfer or conveyance is to an individual, company, or business entity that Franchsior deems in Franchisor’s sole opinion to be a competitor of Franchisors or a competitor of any affiliate of Franchisors or a competitor of any sister or co-brand company of Franchisors or a competitor of a vendor of Franchisors, a second franchisor, a second sub-franchisor, master franchise of a second system or a Franchisee of a second system which has an affiliate company this is a competitor of Franchisors. Any purported assignment without the prior written consent of Franchisor will be null and void and will constitute a material default under this Agreement.--- ---- --- ----A franchise or would be well advised to have a simliar clause in their franchise agreement.
And I recommend that they consult with an experienced and knowledgeable franchisee an attorney who is a specialist. And explain to that franchise attorney their entire business model so that indeed they can come up with the best clause in the franchise agreement to address this issue.
I hope you will consiedr this in 2006."Lance Winslow" - Online Think Tank forum board.
If you have innvoative thoughts and unique perspectives, come think with Lance; http://www.WorldThinkTank.Net/wttbbs/
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Franchising and Prohibited Transfers
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