Michigan Laws 445.1804 – Franchise and lease or other agreement; transfer or assignment; consent; standards; notice of intent; objection; approval; compliance; assumption of obligations; effect of termination or nonrenew
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(1) A franchise agreement and any other lease or agreement in connection with the franchise agreement between a franchisor and a franchisee shall be transferable or assignable if the franchisor consents to the assignment. The franchisor’s consent shall not be unreasonably withheld. A proposed assignee shall meet the standards normally required by the franchisor of a prospective franchisee.
(2) Prior to any transfer or assignment by the franchisee, the franchisee shall provide written notice to the franchisor of an intention to transfer or assign setting forth the prospective assignee’s name, address, statement of financial qualification and business experience during the previous 5 years, and such further information as the franchisor shall reasonably request.
Terms Used In Michigan Laws 445.1804
- Franchise: means a contract between a refiner and a retailer or between a distributor and a retailer, under which a refiner or distributor authorizes or permits a retailer to use, in connection with the sale, consignment, or distribution of gasoline, diesel, gasohol, or aviation fuel, a trademark that is owned or controlled by a refiner, or by a refiner that supplies fuel to the distributor that authorizes or permits such use. See Michigan Laws 445.1802
- Franchisee: means a retailer who is authorized or permitted, under a franchise, to use a trademark in connection with the sale, consignment, or distribution of fuel. See Michigan Laws 445.1802
- Franchisor: means a refiner or distributor who authorizes or permits, under a franchise, a retailer to use a trademark in connection with the sale, consignment, or distribution of fuel. See Michigan Laws 445.1802
- in writing: shall be construed to include printing, engraving, and lithographing; except that if the written signature of a person is required by law, the signature shall be the proper handwriting of the person or, if the person is unable to write, the person's proper mark, which may be, unless otherwise expressly prohibited by law, a clear and classifiable fingerprint of the person made with ink or another substance. See Michigan Laws 8.3q
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Public law: A public bill or joint resolution that has passed both chambers and been enacted into law. Public laws have general applicability nationwide.
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
(3) The franchisor, within 60 days after receipt of the notice of intent and all requested information, shall advise the franchisee of its consent or objection to the transfer or assignment.
(4) If the franchisor objects to the transfer or assignment, it shall state its reasons in writing to the franchisee. If the franchisor does not reply within 60 days, approval of the transfer or assignment shall be considered granted.
(5) The transfer or assignment shall not be valid until the assignee agrees in writing to comply with all the requirements of the franchise and any other lease or agreement in connection with the franchise then in ef fect and assumes all obligations of the franchisee.
(6) A franchisee may not exercise the right of assignment or transfer after he or she has been notified of termination or nonrenewal of the franchise for a cause permitted in the petroleum marketing practices act, Public Law 95-297, 15 U.S.C. § 2801 to 2806 and 2821 to 2841.
(7) A franchisee shall not sell, convey, or otherwise dispose of the franchisee’s interest in a lease, any franchise relationship attendant to a lease, or the franchisee’s business as related to a lease without first giving the franchisor an option to purchase or otherwise acquire the interest on the same terms and conditions as set forth in any contract entered into and fully executed by the franchisee in a bona fide transaction, except for a sale or transfer from the franchisee to the franchisee’s spouse, adult child, stepchild, son-in-law, or daughter-in-law.