What sections of the Conditional Assignment of Lease for Floyds 99 are effective immediately upon execution?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
With the exception of Sections 3, 4, 8, 9, 10, 11, 12 and 13 below which are effective as of the date this Agreement is fully executed by the parties, the assignment of Lease contemplated hereunder is conditional and shall not be effective until the "Effective Date," as defined in Section 5 of this Agreement. Assignee shall have no right to pursue any remedy hereunder unless and until:
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, certain sections of the Conditional Assignment of Lease agreement take effect immediately upon its execution. Specifically, Sections 3, 4, 8, 9, 10, 11, 12, and 13 are effective from the date the agreement is fully executed by all parties involved. The remaining sections of the assignment are conditional and will only become effective upon the occurrence of specific events, such as a default by the Assignor (the original tenant) under the lease or franchise agreement, or the discontinuation of the Floyds 99 shop's operation.
This immediate effectiveness of certain sections has several implications for a prospective Floyds 99 franchisee. These sections likely contain provisions related to the rights and obligations of the parties involved, such as assignment provisions, notice requirements to the franchisor, and other protective measures for Floyds 99 Franchising, LLC. The franchisee should carefully review these sections to understand their responsibilities and the franchisor's rights from the outset of the agreement.
The conditional nature of the remaining sections means that the actual assignment of the lease to Floyds 99 Franchising, LLC (the Assignee) only occurs if certain triggering events take place. Until such an event occurs, the landlord will continue to look to the original tenant (the Assignor) for the full performance of their obligations under the lease. This arrangement provides a level of security for the landlord while also giving Floyds 99 Franchising, LLC the ability to step in and take over the lease if the franchisee defaults or ceases operations.
Understanding which sections are immediately effective and which are conditional is crucial for any prospective Floyds 99 franchisee. It allows them to be aware of their obligations and the franchisor's rights from the beginning, as well as the circumstances under which the lease may be assigned to the franchisor. Franchisees should seek legal counsel to fully understand the implications of this Conditional Assignment of Lease agreement.