What is the condition for Dog Haus to assign the Area Development Agreement, irrespective of any rights granted to the franchisor?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
Area Developer acknowledges and agrees that Area Developer has no right, by operation of law or otherwise, to sell, assign, transfer, pledge, donate, encumber or otherwise deal with, directly or indirectly, (i) any interest in this Agreement; or (ii) the right to use the Dog Haus System or the Dog Haus Marks granted pursuant to this Agreement (an "Assignment") without Franchisor's prior written consent.
Franchisor shall not unreasonably withhold its consent to an Assignment if, in Franchisor's judgment, Area Developer satisfies the conditions to the Assignment identified in this Agreement.
- Unless the Parties otherwise agree in writing, Area Developer shall not make any Assignment of this 9.2.1 Agreement except in conjunction with a concurrent Assignment to the same approved assignee of all Dog Haus Restaurants then owned and operated by Area Developer in the Development Area.
As a condition to Franchisor's consent to such an Assignment, the assignee must execute Franchisor's Then-Current form of Franchise Agreement for each Dog Haus Restaurant sold to the assignee.
Source: Item 23 — RECEIPTS (FDD pages 87–328)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, an Area Developer needs Dog Haus's prior written consent to sell, assign, transfer, pledge, donate, encumber or otherwise deal with any interest in the Area Development Agreement or the right to use the Dog Haus System or the Dog Haus Marks. Dog Haus will not unreasonably withhold consent if the Area Developer meets the conditions for assignment outlined in the agreement.
Specifically, unless otherwise agreed to in writing, the Area Developer must make any assignment of the Area Development Agreement in conjunction with a concurrent assignment to the same approved assignee of all Dog Haus Restaurants then owned and operated by the Area Developer in the Development Area. As a condition of Dog Haus's consent, the assignee must execute Dog Haus's then-current form of Franchise Agreement for each Dog Haus Restaurant sold to the assignee.
Additional conditions include the Area Developer being in good standing, the sales price being reasonable, the buyer signing Dog Haus's current Area Development Agreement, and the Area Developer fulfilling obligations that survive the agreement's transfer. Both the Area Developer and the proposed buyer must execute a general release, and the Area Developer must pay a transfer fee. The Area Developer must also transfer all necessary contracts to the buyer and ensure all third-party consents are obtained. If the buyer is a business entity, individuals owning 20% or more of the equity must execute a guarantee. The Area Developer's right to sales proceeds is subordinate to obligations owed to Dog Haus. Unless the transferee is an existing franchisee, the buyer and a managerial employee must complete Dog Haus's initial training program, and the buyer must conform the Dog Haus Restaurants to Dog Haus's current standards.