What duties and obligations of the lease is the Alloy Franchisor bound by after assuming the lease?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
acilities. In the event Franchisor exercises its option to purchase assets of Tenant, Landlord must permit Franchisor to remove all such assets being purchased by Franchisor.
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- Assumption and Subsequent Assignment By Franchisor. If Franchisor elects to assume the Lease under paragraph 2, or unilaterally assumes the Lease as provided for in paragraphs 3 or 4, Landlord and Tenant agree that:
- (a) Tenant will remain liable for the responsibilities and obligations, including amounts owed to Landlord, prior to the date of assignment and assumption. Further, Tenant shall be and remain liable to Landlord for all of its obligations under the Lease, notwithstanding any assignment or assumption of the Lease by Franchisor. Franchisor shall be entitled to recover from Tenant all amounts it pays to Landlord to cure Tenant's defaults under the Lease, including interest and reasonable collection costs.
- (b) Franchisor, upon taking possession of the Premises, shall cure any default specified by Landlord within the timeframes noted herein and shall execute and deliver to Landlord its assumption of Tenant's rights and obligations under the Lease. Franchisor shall pay, perform and be bound by all the duties and obligations of the Lease applicable to Tenant.
- (c) At or after the time Franchisor assumes Tenant's interests under the Lease, the Franchisor may, at any time, assign such interests or sublet the Premises to an ALLOY franchisee.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, if Alloy elects to assume the lease, it is bound by specific duties and obligations. Upon taking possession of the premises, Alloy must address any defaults specified by the landlord within the given timeframes and must formally agree to assume the tenant's rights and obligations under the lease.
Specifically, Alloy is required to pay, perform, and be bound by all the duties and obligations of the lease that were originally applicable to the tenant. This means Alloy steps into the shoes of the original tenant and must fulfill all responsibilities outlined in the lease agreement.
However, Alloy has the right to assign its interests in the lease or sublet the premises to an Alloy franchisee, provided the landlord gives prior written consent. The landlord cannot unreasonably withhold consent if the assignee is a creditworthy franchisee who meets Alloy's standards and agrees to operate the facility as an Alloy location under a Franchise Agreement. Once the landlord receives an assumption agreement from the assignee, Alloy is released from all liability as the tenant under the lease from that point forward, without needing written acknowledgment from the landlord.