If a Floyds 99 franchisee wishes to transfer their rights, what right does the franchisor have?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
tate or federal law. If the Franchisee and the proposed transferee comply with all conditions for assignment set forth herein and the Franchisor has not given the Franchisee notice of its approval or disapproval within the
90-day period, approval is deemed granted. The Franchisor's approval of any transfer shall not constitute approval for any subsequent transfer or a waiver of any of the Franchisor's rights under this Article 18.
- 18.4 Right of First Refusal. If the Franchisee wishes to transfer its rights under this Agreement or any interest in it, or any part or portion of any business entity that owns it, or all or a substantial portion of the assets of the FLOYD'S 99 Shop, the Franchisee agrees to grant to the Franchisor a 90-day right of first refusal to purchase such rights, interest or assets on the same terms and conditions as are contained in the written offer to purchase submitted to the Franchisee by the proposed purchaser; provided, however, the following additional terms and conditions shall apply:
- a.
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, if a franchisee wishes to transfer their rights under the Franchise Agreement, Floyds 99 has a right of first refusal. This means that the franchisee must first offer Floyds 99 the opportunity to purchase the rights, interest, or assets of the franchise on the same terms and conditions as any written offer received from a proposed purchaser. Floyds 99 has 90 days to exercise this right of first refusal. If Floyds 99 does not respond within this 90-day period, it is considered a waiver of their right.
This right of first refusal allows Floyds 99 to maintain control over who becomes a franchisee within their system. It ensures that they have the option to buy back a franchise location before it is sold to someone who may not meet their standards or align with their brand. This can be a significant factor for prospective franchisees to consider, as it could potentially limit their ability to sell the franchise to a buyer of their choice.
However, the right of first refusal does not apply in certain specific types of transfers. These include situations where the franchisee is a partnership or business association and there is an addition or deletion of a partner or member, or a transfer of partnership or membership among existing partners or members. It also does not apply when an individual franchisee transfers to a corporation or limited liability company controlled by them, subject to certain conditions. In these cases, Floyds 99 will also waive any transfer fee that would normally be chargeable to the franchisee.