What is the effect of the assumption of the Belocal franchise agreement on the Assignee?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Assumption. Assignee hereby assumes all of Assignor's obligations, agreements, commitments, duties, and liabilities under the Franchise Agreement and agrees to be bound by and observe and faithfully perform all of the obligations, agreements, commitments, and duties of Assignor under the Franchise Agreement with the same force and effect as if the Franchise Agreement had been originally written with Assignee as Franchisee.
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- Amendment to Franchise Agreement.
- a. All references to [Assignor Name] as Franchisee in the Franchise Agreement are hereby deleted and replaced with [Assignee Name].
- b. Attachment E to the Franchise Agreement is hereby deleted in its entirety and replaced with the Amended Attachment E attached hereto.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, when an assignee assumes a Belocal franchise agreement, the assignee takes on all of the assignor's obligations, agreements, commitments, duties, and liabilities under the original franchise agreement. This means the assignee is bound by the terms as if they were the original franchisee. The franchise agreement is effectively rewritten with the assignee as the franchisee.
Specifically, all references to the original franchisee (Assignor Name) in the Franchise Agreement are deleted and replaced with the new franchisee's name (Assignee Name). Additionally, Attachment E to the Franchise Agreement is deleted and replaced with an amended version. This attachment likely contains specific details relevant to the assignee, such as ownership interests.
In practical terms, a prospective Belocal franchisee who is considering taking over an existing franchise needs to understand that they are stepping into the shoes of the previous franchisee. They will be responsible for fulfilling all the obligations outlined in the original franchise agreement, as well as any amendments made during the assignment process. It is crucial to carefully review the original agreement and the amended Attachment E to fully understand the scope of these obligations and any potential liabilities.