Can an All County franchisee pledge an ownership interest in you as security?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
- 20.3.6. pledge of this Agreement (to someone other than us) or of an ownership interest in you as security, foreclosure upon the Business or your transfer, surrender or loss of possession, control or management of the Business; or
Source: Item 23 — Receipts (FDD pages 43–157)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, a franchisee can pledge an ownership interest in the All County business as security. However, this action is considered an assignment that requires All County's prior written approval.
Specifically, the FDD states that the pledge of an ownership interest in the franchisee as security is included in the definition of an assignment, transfer, sale, gift, or other disposition. Therefore, a franchisee must obtain approval from All County before pledging their ownership interest as security.
This requirement allows All County to maintain control over who has an interest in their franchises and ensures that anyone with an ownership stake meets their standards. Failure to obtain approval would constitute a breach of the franchise agreement.