Hello, I own a US based home services franchise business that I am considering exiting. The revenues are ~$900k annually but the owners discretionary income is likely <$50k, still sharpening the pencil on that.
In order to have the most flexibility and sell to the widest audience, I'd like to have the option to sell the business assets: clients,employees&prospects, without selling the franchise rights themselves. One can operate this business without much operationally from the franchisor. Although I am struggling to determine where it does, I am told that my Franchise Disclosure Document restricts me selling my clients with the franchisor approval.
>> My first question is how would they enforce this? If I sell the assets to another company - I assume the only thing they could try and do is sue me? If the business isn't worth that much I doubt they would pursue.
>> My second question is - I wonder if a way around this restriction is to "give away" my assets for some some years-away option in the purchasing entity - say options to purchase equity some time away. I don't need to nor expect to make much money off the business sale, so picking up some potential future equity has upside.