What provision does Auntie Annes require in the lease regarding reassignment after Auntie Annes assumes the lease?

According to Auntie Annes's 2024 Franchise Disclosure Document, Auntie Annes requires that franchisees use commercially reasonable efforts to ensure that all leases include specific terms, unless otherwise agreed to in writing. One of these terms addresses the scenario where Auntie Annes assumes the franchisee's lease.

Specifically, the lease should provide that if Auntie Annes assumes the franchisee's obligations and replaces them as the lessee, or signs a new lease, and then later reassigns that lease or new lease to another franchisee, Auntie Annes will not be liable for any obligations to the landlord under the lease or new lease after the reassignment. This provision aims to protect Auntie Annes from ongoing liabilities to the landlord once they have reassigned the lease to a new franchisee.

This is a beneficial provision for Auntie Annes, as it limits their long-term liability related to the lease. For a prospective franchisee, this highlights the importance of carefully reviewing lease agreements and understanding the conditions under which Auntie Annes might assume and then reassign the lease. It also indicates that Auntie Annes has considered potential lease-related liabilities and has taken steps to mitigate them.