factual

After an assignment of a Beehive Homes franchise, is the assignor released from any obligations to Beehive Homes?

Q: After an assignment of a Beehive Homes franchise, is the assignor released from any obligations to Beehive Homes?

5. Assignor agrees to remain personally bound by, and personally liable for the breach of, each and every provision of the Franchise Agreement, both monetary obligations and obligations to take or refrain from taking specific actions or to engage or refrain from engaging in specific activities, and is not released from any obligations to Bee Hive Homes by this Assignment. After the date of this Assignment, all references to Franchisee in the Franchise Agreement shall refer to both Assignor and Assignee both jointly and severally. Source: Item 23 — RECEIPTS (FDD pages 34–123)

Beehive_Homes Franchise · 2025 FDD

Answer from 2025 FDD Document

Assignor agrees to remain personally bound by, and personally liable for the breach of, each and every provision of the Franchise Agreement, both monetary obligations and obligations to take or refrain from taking specific actions or to engage or refrain from engaging in specific activities, and is not released from any obligations to Bee Hive Homes by this Assignment. After the date of this Assignment, all references to Franchisee in the Franchise Agreement shall refer to both Assignor and Assignee both jointly and severally.

Source: Item 23 — RECEIPTS (FDD pages 34–123)

What This Means (2025 FDD)

According to Beehive Homes' 2025 Franchise Disclosure Document, an assignor is not released from their obligations to Beehive Homes after an assignment of the franchise. The assignor remains personally bound by and liable for any breaches of the Franchise Agreement. This includes both monetary obligations and the responsibility to take or avoid specific actions.

This means that even after transferring the franchise to an assignee, the original franchisee (assignor) continues to be responsible for ensuring the terms of the Franchise Agreement are met. Beehive Homes can pursue both the assignor and the assignee for any failures to comply with the agreement. All references to 'Franchisee' in the original agreement apply jointly and severally to both the assignor and the assignee after the assignment date.

This provision protects Beehive Homes by ensuring that there is always a party responsible for upholding the Franchise Agreement, even after the franchise changes hands. A prospective franchisee should carefully consider this ongoing liability before assigning their franchise, as they will remain on the hook for the assignee's actions. It is advisable to seek legal counsel to fully understand the implications of this clause before signing any assignment agreement.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.

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