Are there any restrictions on the All Team franchisor's right to assign the franchise agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
However, no assignment will be made except to an assignee who in good faith and judgment of the franchisor, is willing and financially able to assume the franchisor's obligations under the Franchise Agreement.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 28–30)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, there are some restrictions regarding the franchisor's ability to assign the franchise agreement. All Team cannot make an assignment to just anyone; the assignee must be willing and financially able to assume All Team's obligations under the Franchise Agreement. The assignee must also be someone who, in All Team's good faith judgment, is suitable.
This provision protects franchisees by ensuring that if All Team decides to assign the Franchise Agreement to another party, that party will be capable of fulfilling the obligations that All Team has promised in the agreement. This could include providing ongoing support, maintaining the brand standards, and upholding other commitments outlined in the franchise agreement.
This type of clause is relatively common in franchise agreements. It aims to provide a level of security for the franchisee, preventing the franchisor from assigning the agreement to an entity that is not equipped to handle the responsibilities. Prospective franchisees should carefully consider this provision, as it offers some protection in the event of a change in franchisor ownership or management.