What is one condition that Marble Slab Creamery may impose for assignment?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
12.2.3.7 The transferee will execute, for a term ending on the expiration date of this Agreement and with such renewal term as may be provided by this Agreement, the standard form franchise agreement then being offered to new franchisees of Franchisor and such other ancillary agreements as Franchisor may require for the Restaurant, which agreements will supersede this Agreement in all respects and the terms of which agreements may differ from the terms of this Agreement, including, a higher percentage royalty rate and advertising contribution; but that the transferee will not be required to pay any Initial Fee;
12.2.3.8 At Franchisor's request, Franchisee and/or its Owners, the transferor and the transferee's Owners shall have executed a continuing guaranty in favor of Franchisor of the performance and payment by the transferee of all obligations and debts to Franchisor and its Affiliates under this Agreement and, if applicable, the replacement franchise agreement.
Source: Item 22 — CONTRACTS (FDD page 101)
What This Means (2025 FDD)
According to Marble Slab Creamery's 2025 Franchise Disclosure Document, a condition for assignment is that the transferee will execute the standard form franchise agreement then being offered to new franchisees for a term ending on the current agreement's expiration date, including any renewal term. This new agreement will supersede the original agreement and its terms may differ, potentially including a higher percentage royalty rate and advertising contribution. However, the transferee will not be required to pay any initial franchise fee.
This condition means that a prospective buyer of an existing Marble Slab Creamery franchise may be subject to the terms of the current franchise agreement, which could be less favorable than the terms of the original agreement. This is a fairly standard practice in franchising, as franchisors want to ensure that all franchisees are operating under the same set of rules and standards.
Furthermore, Marble Slab Creamery may request that the franchisee and/or its owners, the transferor, and the transferee's owners execute a continuing guaranty in favor of Marble Slab Creamery for the performance and payment by the transferee of all obligations and debts to Marble Slab Creamery and its affiliates under the agreement and, if applicable, the replacement franchise agreement. This protects Marble Slab Creamery in case the new franchisee defaults on their financial obligations.