What is considered an 'Assignment' regarding a Dog Haus franchise?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
Accordingly, to protect the Dog Haus System, the Dog Haus Marks, the Dog Haus Trade Secrets and the goodwill associated with the same, Franchisee shall not offer, sell, or negotiate the sale of its rights under this Agreement to any third party, either in Franchisee's own name or in the name and/or on behalf of Franchisor, except as otherwise provided in this Agreement.
Franchisee acknowledges and agrees that Franchisee 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 (an "Assignment") without Franchisor's prior written consent.
Franchisor shall not unreasonably withhold its consent to an Assignment if, in Franchisor's judgment, Franchisee satisfies the conditions to the Assignment identified in this Agreement.
- 14.2.1 Unless the Parties otherwise agree in writing, Franchisee shall not make any Assignment of this Agreement except in conjunction with a concurrent Assignment to the same approved assignee of all Dog Haus Restaurants then owned and operated by Franchisee.
As a condition to Franchisor's consent to an Assignment, the assignee must execute Franchisor's Then-Current form of Franchise Agreement for each Franchised Restaurant sold to the assignee.
Further, without Franchisor's prior written consent, which may be withheld by Franchisor in its discretion, (i) Franchisee shall not offer for sale or transfer at public or private auction any of the rights of Franchisee under this Agreement; and (ii) Franchisee shall not, directly or indirectly, pledge, encumber, hypothecate or otherwise grant any third party a security interest in this Agreement in any manner whatsoever.
To the extent that the foregoing prohibition may be ineffective under Applicable Law, Franchisee shall provide not less than ten (10) days' prior written notice (which notice shall contain the name and address of the secured party and the terms of the pledge, encumbrance, hypothecation or security interest) of any pledge, encumbrance, hypothecation or security interest in this Agreement.
Source: Item 22 — CONTRACTS (FDD page 87)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, an "Assignment" refers to any action by a franchisee that involves selling, assigning, transferring, pledging, donating, encumbering, or otherwise dealing with their interest in the Franchise Agreement or the right to use the Dog Haus System or the Dog Haus Marks without the prior written consent of Dog Haus.
For a prospective franchisee, this means that they cannot transfer their rights or obligations under the franchise agreement to another party without first obtaining Dog Haus's approval. Dog Haus states that it will not unreasonably withhold consent to an assignment if the franchisee meets the conditions outlined in the agreement.
The FDD specifies that franchisees cannot offer to sell or transfer their rights at a public or private auction, nor can they pledge or grant a security interest in the agreement to a third party without Dog Haus's consent. If such a prohibition is deemed ineffective under applicable law, the franchisee must provide Dog Haus with at least ten days' prior written notice, including the name and address of the secured party and the terms of the arrangement.