What leasehold actions is an All County franchisee obligated to take at All County's election?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
- 23.6.2. Leasehold Rights. You agree, at our election, to assign your leasehold interest in the Location to us or, to enter into a sublease for the remainder of the lease term on the same terms (including renewal options) as the prime lease.
- 23.6.3. Purchase Price. The purchase price for the Business will be its fair market value, determined in a manner consistent with reasonable depreciation of the Business' equipment, signs, inventory, materials and supplies, provided that the Business will be valued as an independent business and its value will not include any value for the Franchise or any rights granted by this Agreement; the Marks; or participation in the network of ALL COUNTY® businesses. The length of the remaining term of the lease for the Location will also be considered in determining the Business' fair market value.
Source: Item 23 — Receipts (FDD pages 43–157)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, upon termination or expiration of the franchise agreement, All County has the option to purchase the franchisee's business. If All County exercises this option, the franchisee is obligated to take certain actions regarding the leasehold.
Specifically, at All County's election, the franchisee must either assign their leasehold interest in the business location to All County or enter into a sublease with All County for the remainder of the lease term. The sublease must be on the same terms and conditions as the original prime lease, including any renewal options. This ensures that All County can continue operating the business at the same location without interruption.
This requirement is significant for prospective franchisees as it dictates the terms of exiting the business. Franchisees should carefully consider the implications of potentially having to assign or sublease their location to All County, especially in terms of lease terms and conditions. It is also important to note that the purchase price for the business will consider the length of the remaining lease term when determining the fair market value.