What is the role of the 'New Franchisee' in the context of the Crepe De Licious assignment agreement?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
sted Assignment of Franchised Business. | | Franchisor hereby consents to | | the Requested Assignment of the Franchised Business from Former Franchisee to New Franchisee upon | | receipt of the Franchisor's Assignment Fee from Former Franchisee and the mutual execution of this | | Agreement by all parties. | | Franchisor waives its right of first refusal set forth in the Former Franchise | | Agreement and waives any obligation for Former Franchisee to enter into a subordination agreement |
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.
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- 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.
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- Former Franchisee's Contact Information.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, the 'New Franchisee' in an assignment agreement assumes the sole right to operate the franchised business under a new franchise agreement. The former franchisee's rights are terminated, and the new franchisee must execute a new franchise agreement, potentially amended by a franchisor-prescribed addendum, along with any other required contracts for operating a Crepe De Licious franchise.
The New Franchisee acknowledges that the transaction to purchase the rights to the franchised business occurred solely between the former franchisee and the new franchisee, with Crepe De Licious's involvement limited to approving the requested assignment and any necessary actions related to the new franchisee signing the new franchise agreement. The New Franchisee agrees that any claims, disputes, or issues relating to the acquisition of the franchised business from the former franchisee are strictly between the two franchisees and will not involve Crepe De Licious.
This arrangement means the New Franchisee needs to conduct thorough due diligence on the business being acquired from the Former Franchisee, as Crepe De Licious bears no responsibility for disputes arising from that transaction. The New Franchisee should be aware that they are stepping into a new agreement with Crepe De Licious, independent of the previous franchisee's obligations, except where those obligations expressly survive the termination or transfer of the Former Franchise Agreement.