What is the requirement of the assignee for Floyds 99 Franchising, LLC to be released from its obligations under the Development Agreement?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
This Agreement is fully assignable by the Franchisor and shall inure to the benefit of any assignee or other legal successor in interest, and the Franchisor shall in such event be fully released from the same, provided no assignment shall be made except to an assignee who, in the Franchisor's good faith judgment, is willing and able to assume the Franchisor's obligations under this Agreement.
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, specifically the Rider to the Franchise Agreement for the state of New York, Floyds 99 Franchising, LLC can assign the agreement and be released from its obligations if the assignee is willing and able to assume those obligations. This is contingent on Floyds 99's good faith judgment that the assignee meets these criteria.
For a prospective franchisee, this means that Floyds 99 has the right to transfer its responsibilities under the Development Agreement to another party. However, this transfer is not unconditional. Floyds 99 must assess whether the new party is capable of fulfilling the obligations outlined in the agreement.
This clause protects franchisees by ensuring that Floyds 99 cannot simply transfer its obligations to an entity that is unable to meet them. It also provides Floyds 99 with flexibility in managing its business and potentially restructuring its operations. However, the final determination of the assignee's suitability rests with Floyds 99, which introduces a degree of subjectivity into the process.