Under the Floyds 99 Conditional Assignment of Lease, who is initially responsible for fulfilling the obligations under the Lease?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS CONDITIONAL ASSIGNMENT OF LEASE ("Agreement") is made as of this day of |
|---|
| , |
| 20 |
| by |
| and |
| between |
| , |
| a |
| ("Assignor"), FLOYD'S 99 |
| FRANCHISING, LLC, |
| a Colorado limited liability |
| company ("Assignee") and ("Landlord"). |
| A. |
| Assignor |
| is |
| a |
| tenant |
| ("Tenant") |
| of |
| certain |
| property |
| generally |
| known |
| as |
| , |
| located |
| in |
| the |
| City |
| of |
| , |
| State |
| of |
| ("Property"), pursuant to a lease by and between Landlord and Assignor, dated |
| , 20 (the "Lease"). |
| B. |
| Assignor desires to construct, or have constructed by Landlord (whichever is applicable), and |
| thereafter operate a FLOYD'S 99 Shop under a certain franchise agreement between Assignor and Assignee (the |
| "Franchise Agreement"). |
| C. |
| As a condition to the grant of rights under the Franchise Agreement to Assignor, Assignee requires |
| that Assignor enter into this Agreement. |
| NOW, THEREFORE, for and in consideration of the sum of Five Dollars and other good and valuable |
| consideration, the receipt of which is hereby acknowledged, the parties agree as follows: |
| 1. |
| Assignor hereby assigns all of its right, title and interest in and to the Lease and the FLOYD'S 99 |
| Shop to Assignee. Although it is the intention of the parties that this Agreement is a present assignment, it is expressly |
| understood and agreed that until an event described in Section 2 below has occurred and Assignee has exercised its |
| remedies hereunder, Landlord shall look to Assignor for full performance of Assignor's obligations under the Lease. |
Source: Item 23 — RECEIPT (FDD pages 58–229)
What This Means (2025 FDD)
According to Floyds 99's 2025 Franchise Disclosure Document, the Assignor is initially responsible for fulfilling the obligations under the lease. Specifically, the agreement states that until certain events occur and Floyds 99 Franchising, LLC (the Assignee) exercises its remedies, the Landlord will look to the Assignor for full performance of the obligations outlined in the lease.
This means that the franchisee, as the Assignor, remains the primary point of contact and is accountable for all lease-related responsibilities, such as rent payments, property maintenance, and adherence to lease terms. Floyds 99's conditional assignment of lease does not immediately transfer these responsibilities to the franchisor.
However, this arrangement is conditional. If the franchisee defaults on the lease, defaults on the franchise agreement, becomes insolvent, discontinues operation of the Floyds 99 shop, or fails to renew the franchise agreement or the lease, Floyds 99 Franchising, LLC, as the Assignee, has the right to step in and assume the lease. This provides a safety net for the landlord and ensures the continued operation of the Floyds 99 location.
Prospective franchisees should understand that while Floyds 99 has the option to assume the lease under certain conditions, the initial and ongoing responsibility for fulfilling the lease obligations rests firmly with the franchisee. This includes all financial and operational aspects of the lease agreement.