Is the Floyds 99 software license transferable to another party?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 16.1 Grant of License. The Franchisor will license one or more proprietary computer software programs (the "Software") to the Franchisee for use in the operation of the FLOYD'S 99 Shop, including any modifications or revisions thereto, all documentation (other than the Software) related to the Software, the tangible media upon which such programs are recorded and the database file structure thereof (collectively, the "Program"). The Franchisor hereby grants to the Franchisee a nonexclusive, nontransferable, fully paid license to use the Program (the "License") for the term hereof, and agrees to provide updates for the Program for the term hereof. The parties agree as follows:
- a. The Program shall be installed on the computer equipment designated by the Franchisor as meeting its specifications (the "Designated Equipment").
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, the software license granted to franchisees is explicitly non-transferable. The FDD states that Floyds 99 grants franchisees a "nonexclusive, nontransferable, fully paid license" to use the proprietary computer software programs (the "Software") for the term of the franchise agreement. This means a franchisee cannot transfer or assign the software license to another party, such as a buyer if they sell their franchise.
This restriction is typical in franchising, as franchisors like Floyds 99 need to maintain control over their brand standards, operational systems, and intellectual property. By keeping the software license non-transferable, Floyds 99 ensures that only authorized franchisees are using their proprietary software and that any new owners obtain a fresh license directly from the franchisor. This allows Floyds 99 to properly vet and train new franchisees on the software and maintain consistency across all locations.
For a prospective Floyds 99 franchisee, this non-transferability clause means that the software license is tied to the original franchisee and the specific franchise agreement. If the franchisee sells the business or the franchise agreement is terminated, the software license reverts back to Floyds 99. A new owner would need to obtain a new software license from Floyds 99, potentially incurring additional fees or requiring updated training on the software. This is a crucial point to consider when planning for the future of the franchise and potential exit strategies.