Are there any restrictions on Precision Door Service's right to assign the Development Agreement?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement ("DA") (unless otherwise specified | Summary | |
|---|---|---|---|
| g. | "Cause" defined - defaults which can be cured | Section 6 | 120 days to cure a development schedule default; 30 days to satisfy a final judgment, to dismiss a suit to foreclose any lien or mortgage against the premises or any equipment of the Business or to remedy other defaults that are curable. |
| h. | "Cause" defined - defaults which cannot be cured | Section 6 | Bankruptcy or insolvency, execution against PE Owner's business or property; real or personal property is sold after levy. |
| i. | Your obligations on termination/non-renewal | Section 5 and 7.2 | Compliance with post-termination covenant not to compete. |
| j. | Assignment of contract by us | Section 6 | No restriction on our right to assign. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 72–80)
What This Means (2025 FDD)
According to the 2025 Precision Door Service Franchise Disclosure Document, there are no restrictions on the company's right to assign the Development Agreement. This means Precision Door Service can transfer its rights or obligations under the Development Agreement to another party without needing the franchisee's approval or meeting specific conditions.
For a prospective franchisee, this signifies that the entity they initially contract with may change during the term of the agreement. The new entity would then assume the franchisor's responsibilities and rights. While this is permitted, it's important for franchisees to understand that the quality of support, resources, and overall relationship could potentially shift depending on who Precision Door Service assigns the agreement to.
In the franchise industry, it is not uncommon for franchisors to retain the right to assign agreements, as this provides flexibility in business operations, potential mergers, or acquisitions. However, franchisees should carefully consider the implications and ensure they are comfortable with the possibility of a change in franchisor. It would be prudent for a prospective franchisee to inquire about Precision Door Service's history of assignments and the criteria they use when considering such transfers.