What qualifications must a proposed buyer meet to obtain Dog Haus's consent to an assignment?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
otherwise.
- 14.3.3 If Franchisor or its nominee elects to purchase or acquire the rights, assets, Equity or interests proposed to be assigned to the Proposed Buyer, the closing shall take no later than sixty (60) days following the date that the Purchase Notice was issued by Franchisor.
- 14.3.4 If Franchisor does not elect to purchase or acquire the rights, assets, Equity or interests proposed to be assigned to the Proposed Buyer, the closing of the sale to the Proposed Buyer shall take no later than ninety (90) days following the date that the Third Party Offer was received by Franchisee. If there is any material change in the terms of the Third Party Offer before the closing of the sale, Franchisor shall have a right of first refusal to accept the new terms subject to the conditions stated in this Section 14.3.
- 14.4 Conditions of Assignment to Third Party. As a condition to obtaining Franchisor's consent to an Assignment, all of the following conditions must be satisfied:
- 14.4.1 The Proposed Buyer must submit a completed franchise application to 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.
Source: Item 22 — CONTRACTS (FDD page 87)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, a proposed buyer seeking assignment must meet several qualifications to obtain Dog Haus's consent. The proposed buyer must submit a completed franchise application and meet Dog Haus's then-current qualifications for new franchisees. These qualifications encompass financial condition, credit rating, experience, moral character, and reputation.
Additionally, the sales price of the interest to be conveyed must not be so high, or the terms of the sale so onerous, that, in Dog Haus's judgment, the proposed buyer will be unlikely to meet its financial and other obligations to Dog Haus, third-party suppliers, and creditors following the closing. The proposed buyer must also sign Dog Haus's then-current form of Franchise Agreement, which may differ materially from the existing agreement and will supersede it, except that the term of the replacement Franchise Agreement will be the remaining term of the original agreement. If the proposed buyer is an entity, each owner and their spouse must guarantee the buyer's performance under the new Franchise Agreement.
Furthermore, unless the transferee is an existing franchisee, the proposed buyer and a managerial employee with general management responsibilities must complete Dog Haus's Initial Training Program to Dog Haus's satisfaction before the assignment's effective date. The proposed buyer must also conform the franchised restaurant to Dog Haus's then-current appearance, design standards, and equipment specifications applicable to new Dog Haus restaurants. The proposed buyer must also spend an amount equal to Dog Haus's then-current required transfer marketing expenditure to conduct a promotional campaign for the Franchised Restaurant during the first three (3) months of operations following the take-over date of the Franchised Restaurant in accordance with Dog Haus's then-current transfer marketing requirements.