What condition regarding lease defaults must be met for an Apricot Lane tenant to assign their lease?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary contained herein, Tenant shall have the right at any time with Landlord consent which shall not be unreasonably withheld, conditioned or delayed, to assign this Lease to Tenant's Franchisor or a bona-fide and qualified franchisee of Franchisor, provided that the following conditions are met:
- (i) Tenant shall deliver to Landlord not less than 30 days prior written notice of such assignment;
- (ii) at the time of any such assignment, Tenant shall not be in default under this Lease;
- (iii) if assignment is to a franchisee, such franchisee meets all the standard criteria applicable to Franchisor's franchisees generally;
- (iv) the franchisee shall be contractually obligated to operate the Premises under the same Trade Name and for the same Permitted Use specified in this Lease and in all other respects as required by this Lease; and
- (v) the franchisee shall not be unreasonably denied.
Notwithstanding any assignment made pursuant to this Section, Tenant shall not be released from any liability for the payment of rent or other sums due under the Lease, or from the performance of any of the obligations and covenants of the Lease.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, a tenant must not be in default under their lease at the time of assignment. This condition is crucial for an Apricot Lane franchisee looking to assign their lease to either the franchisor or another qualified franchisee. The franchisor's consent is also required for the assignment, and it cannot be unreasonably withheld, conditioned, or delayed.
This provision protects the landlord by ensuring that the lease is only assigned to a party in good standing. It also safeguards the Apricot Lane brand by ensuring that any new franchisee taking over the lease meets the franchisor's standard criteria and operates under the same trade name and permitted use. The outgoing tenant remains liable for the lease obligations even after the assignment, providing further security to the landlord.
For a prospective Apricot Lane franchisee, this means maintaining compliance with the lease terms is essential if they ever wish to assign the lease. Failure to do so could prevent them from transferring the lease to a more suitable party, potentially hindering their exit strategy or business plans. The franchisee should also be aware that obtaining the landlord's consent is a necessary step in the assignment process.