What agreement form must an assignee execute when purchasing a Dog Haus franchise?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
o Franchisor and meet Franchisor's Then-Current qualifications for new Dog Haus franchisees, including qualifications pertaining to financial condition, credit rating, experience, moral character and reputation.
- 14.4.2 Franchisee must be in Good Standing on the date consent is requested and until the date of closing of the Assignment.
- 14.4.3 The sales price of the interest to be conveyed must not be so high, or the terms of the sale so onerous, that, in the judgment of Franchisor, the Proposed Buyer will be unlikely to meet the Proposed Buyer's financial and other obligations to Franchisor, third party suppliers and creditors following the closing. Franchisor shall have no liability to either Franchisee or the Proposed Buyer if Franchisor approves the Assignment and the Proposed Buyer thereafter experiences financial difficulties.
- 14.4.4 The Proposed Buyer must sign Franchisor's Then-Current form of Franchise Agreement, the terms of which may differ materially from any and all of the terms contained in this Agreement, and which shall supersede this Agreement in all respects, except that the term of replacement Franchise Agreement shall be the remaining term of this Agreement. In exchange for signing the Then-Current Franchise Agreement, the Proposed Buyer shall receive the rights provided for in this Agreement. If the Proposed Buyer is an Entity, each owner and each owner's spouse of the Proposed Buyer shall jointly and severally guarantee the Proposed Buyer's performance of its obligations in the Then-Current Franchise Agreement under a Guarantee in the form of Exhibit C.
Source: Item 22 — CONTRACTS (FDD page 87)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, a proposed buyer (assignee) must sign the then-current form of the Franchise Agreement. The terms in this new agreement may differ significantly from the original agreement and will supersede it, except that the term of the replacement Franchise Agreement will be the remaining term of the original agreement. This ensures that the Dog Haus franchise operates under the most up-to-date standards and legal framework established by the franchisor.
In addition to the Franchise Agreement, if the proposed buyer is an entity, each owner and their spouse must jointly and severally guarantee the buyer's performance of their obligations under the new Franchise Agreement, using a guarantee in the form of Exhibit C. The proposed buyer must also execute all other documents and agreements required by Dog Haus to complete the assignment. Furthermore, both the franchisee and the proposed buyer must execute a general release of all known and unknown liabilities against Dog Haus and its affiliates.
There are certain situations where Dog Haus may offer to amend the existing agreement instead of requiring a new one. This can occur if Dog Haus is not offering new franchises, is revising its Franchise Agreement or franchise disclosure document, or is unable to offer its then-current form of Franchise Agreement. In such cases, Dog Haus may offer to amend the agreement on terms established with the proposed buyer or extend the term on a month-to-month basis until a new Franchise Agreement can be offered.
Prospective franchisees should be aware that the requirement to sign a then-current Franchise Agreement could introduce new obligations, higher fees, or different operational standards. It is crucial to carefully review the then-current Franchise Agreement and any related exhibits to understand the full scope of the commitment. Franchisees should also seek legal counsel to assess the implications of these changes and ensure they are comfortable with the new terms before proceeding with the assignment.