In the context of assigning a Crepe De Licious franchise, what is the role of the 'Former Franchisee'?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
effective upon the date of this Agreement, the Former Franchise Agreement shall terminate and all of
- Termination of Rights to the Franchised Business. The parties acknowledge and agree that
pursuant to the Former Franchise Agreement.
Former Franchisee's rights to operate the Franchised Business are terminated and that from the date of this Agreement only New Franchisee shall have the sole right to operate the Franchised Business under the New Franchise Agreement. Former Franchisee and the undersigned Owners agree to comply with all of the covenants in the Former Franchise Agreement that expressly or by implication survive the termination, expiration, or transfer of the Former Franchise Agreement. Unless otherwise precluded by state law, Former Franchisee shall execute Franchisor's current form of General Release Agreement.
New Franchise Agreement.
New Franchisee shall execute the New Franchise Agreement for the Franchised Business (as amended by the form of Addendum prescribed by Franchisor, if applicable), and any other required contracts for the operation of a Crepe de licious franchise as stated in Franchisor's Franchise Disclosure Document.
Former Franchisee's Contact Information.
Former Franchisee agrees to keep Franchisor informed of its current address and telephone number at all times during the three-year period following the execution of this Agreement.
Acknowledgement by New Franchisee.
New Franchisee acknowledges and agrees that the purchase of the rights to the Franchised Business ("Transaction") occurred solely between Former Franchisee and New Franchisee.
New Franchisee also acknowledges and agrees that Franchisor played no role in the Transaction and that Franchisor's involvement was limited to the approval of Requested Assignment and any required actions regarding New Franchisee's signing of the New Franchise Agreement for the Franchised Business.
New Franchisee agrees that any claims, disputes, or issues relating New Franchisee's acquisition of the Franchised Business from Franchisee are between New Franchisee and Former Franchisee, and shall not involve Franchisor.
Representation.
Former Franchisee warrants and represents that it has not heretofore assigned, conveyed, or disposed of any interest in the Former Franchise Agreement or Franchised Business.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, in the event of a franchise assignment, the 'Former Franchisee' plays a specific role in the transition. Upon the effective date of the new agreement, the former franchise agreement terminates, and the Former Franchisee's rights to operate the Franchised Business are terminated. Only the New Franchisee has the right to operate the Franchised Business under the New Franchise Agreement. The Former Franchisee and their owners must comply with all covenants in the former agreement that survive termination, expiration, or transfer. Unless state law prevents it, the Former Franchisee must execute Crepe De Licious's current General Release Agreement.
Furthermore, the Former Franchisee must keep Crepe De Licious informed of their current address and telephone number for three years after the agreement is executed. The New Franchisee acknowledges that the purchase of the franchise rights occurred solely between the Former Franchisee and the New Franchisee, with Crepe De Licious's involvement limited to approving the assignment and the New Franchisee's signing of the new agreement. Any claims, disputes, or issues related to the New Franchisee's acquisition of the Franchised Business from the Former Franchisee are strictly between those two parties and do not involve Crepe De Licious.
The Former Franchisee also warrants that they have not already assigned, conveyed, or disposed of any interest in the former franchise agreement or franchised business. This ensures that the New Franchisee is indeed acquiring all rights to the franchise. In summary, the Former Franchisee is responsible for terminating their operations, transferring rights to the New Franchisee, complying with surviving covenants, providing contact information, and resolving any acquisition-related disputes directly with the New Franchisee, all while Crepe De Licious maintains a limited role in the assignment process.