In the Azal Coffee franchise agreement, besides the franchisee, what other individual's signature is required?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
[Item 22: CONTRACTS]
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- Introduction. Franchisee has entered into a Franchise Agreement with Durar Investment, LLC ("Franchisor"). The Franchise Agreement requires Franchisee's lease for the Premises to contain certain provisions. In consideration of the agreement of Franchisor to enter into a Franchise Agreement with Franchisee for an Azal Coffee franchise to be located at the Premises, Landlord and Franchisee agree that the provisions contained in this Addendum will be applicable to the Lease notwithstanding anything to the contrary contained in the Lease.
- 2. Use. The Premises must not be used for any purpose other than the operation of an Azal Coffee during the term of the Lease, including renewals.
- 3. Franchisor's Options. Landlord and Franchisee grant to Franchisor the exclusive right, exercisable at the option of Franchisor, to be assigned all right, title and interest of Franchisee in and to the Lease and the Premises:
- a. on the expiration or termination of the Franchise Agreement. Franchisor must give written notice of its intent to exercise this option within thirty (30) days of the event triggering the option;
- b. on the expiration or termination of the Lease or on Franchisee's loss of its rights of possession to the Premises, whether by Franchisee's default under the Lease or otherwise. Landlord shall provide Franchisor notice of default as provided under Section 9 and Section 10. Franchisor shall exercise its right to accept assignment of the Lease within such periods; and
- c. on Franchisees abandonment of the Premises. For this purpose, abandonment will be conclusively presumed if Franchisee fails to have the business open and fully operational for two (2) consecutive days.
On the giving of notice of exercise by Franchisor under this Section, the Lease, and all right, title and interest of Franchisee under the lease and to the Premises will be automatically, and without need of further instrument, assigned to Franchisor. If Franchisor does not give notice of exercise within the applicable time period, Franchisor will be deemed to have forfeited all its rights under this Section. Landlord and Franchisee agree to execute documents confirming this assignment in the form presented by Franchisor, including a short form of Lease suitable for recording.
Source: Item 22 — CONTRACTS (FDD page 51)
What This Means (2024 FDD)
According to the 2024 Azal Coffee Franchise Disclosure Document, in addition to the franchisee's signature, the landlord's signature may be required on an addendum to the lease agreement. This addendum ensures that the lease contains specific provisions required by Azal Coffee.
The landlord and the franchisee grant Azal Coffee the option to be assigned the lease for the premises under certain conditions. These conditions include the expiration or termination of the franchise agreement, the expiration or termination of the lease, or the franchisee's abandonment of the premises. If Azal Coffee exercises this option, the landlord and franchisee must execute documents confirming the assignment, including a short form of lease suitable for recording.
This requirement ensures that Azal Coffee has control over the location of its franchises, which is crucial for maintaining brand consistency and operational standards. For a prospective franchisee, this means that securing a lease that is acceptable to Azal Coffee and includes the necessary addendum is a critical step in the franchising process. The franchisee should also be aware that Azal Coffee has the right to take over the lease under certain circumstances, which could impact the franchisee's business operations.