Is a transfer of a Floyds 99 franchise allowed without the Franchisor's consent?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
tion to the Franchisor sufficient for the Franchisor to assess the proposed transferee's business experience, aptitude and financial qualification, and the Franchisor shall have ascertained that the proposed transferee meets such qualifications;
- f. Execution by Franchisee of a general release, in a form satisfactory to the Franchisor, of any and all claims against the Franchisor, its affiliates and their respective officers, directors, employees and agents;
- g. Payment by the Franchisee or the proposed transferee of $7,500;
- h. Neither the proposed transferee nor any of its direct or indirect owners or affiliates operates, has an ownership interest in or performs services for a Competitive Business; and
- i. Agreement by the Franchisee to abide by the post-termination covenant not to compete set forth in Section 22.2 below.
The Franchisor will not unreasonably withhold, delay or condition its consent to any proposed transfer by the Franchisee which requires the Franchisor's consent under this Section 18.2.
18.3 Franchisor's Approval of Transfer. The Franchisor has 90 days from the date of the written notice of the proposed transfer to approve or disapprove in writing, of the Franchisee's proposed transfer. The Franchisee acknowledges that the proposed transferee shall be evaluated for approval by the Franchisor based on the same criteria as is currently being used to assess new franchisees of the Franchisor and that such proposed transferee shall be provided, if appropriate, with such disclosures as may be required by state 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
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, a franchisee generally cannot transfer their franchise rights without the franchisor's approval. Specifically, Section 18.2 states that the franchisor's consent is required for any proposed transfer. This means that if a franchisee wants to sell their Floyds 99 shop to someone else, they must first get permission from Floyds 99.
The FDD outlines several conditions that must be met for a transfer to be considered. These include the payment of a $7,500 transfer fee by either the franchisee or the proposed transferee. Additionally, the proposed transferee cannot be involved with a competitive business. The franchisee must also agree to abide by the post-termination covenant not to compete. These conditions ensure that the new franchisee meets Floyds 99's standards and protects the brand's interests.
Floyds 99 has 90 days from the date of written notice of the proposed transfer to either approve or disapprove the transfer. The prospective buyer will be evaluated using the same criteria as new franchisees. If Floyds 99 fails to respond within this 90-day period, the approval is considered granted. However, even if a transfer is approved, this doesn't waive Floyds 99's rights regarding any future transfers or other provisions of the franchise agreement.
Furthermore, if a franchisee wishes to transfer their rights, Floyds 99 has a right of first refusal, allowing them to purchase the franchise on the same terms as the offer made by the proposed purchaser. This gives Floyds 99 the option to maintain control over the franchise's ownership and direction. These provisions are typical in franchising, as franchisors want to ensure that any new owners are qualified and that the transfer does not negatively impact the brand.