Does the Alloy franchise agreement require franchisees to pay all liens and encumbrances against property used in connection with the Facility or business?

According to Alloy's 2025 Franchise Disclosure Document, if a franchisee proposes to transfer their franchise to a new owner, all outstanding debts must be settled before the transfer can be approved. Specifically, the franchisee must pay all amounts owed to Alloy, its affiliates, suppliers, or the landlord for the Facility premises and the Facility itself. This also includes settling any contingent liabilities that Alloy or its affiliates might have.

This condition ensures that Alloy maintains financial stability and avoids potential legal or financial issues that could arise from unpaid debts of its franchisees. It also protects suppliers and landlords associated with the Alloy franchise by ensuring they receive any outstanding payments.

For a prospective Alloy franchisee, this means that if they plan to sell their franchise, they must first clear all outstanding financial obligations related to the business. This could include rent, supplier invoices, franchise fees, and any other debts. Failure to do so will prevent Alloy from approving the transfer, potentially hindering the franchisee's ability to exit the business.