Under what circumstances related to leasehold interests can a Bang Cookies franchise be dissolved?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Assignee has the right and possesses full power and authority to take possession of the Leased Premises, to eject and expel Assignor from possession and occupancy of the Leased Premises and to terminate Assignor's right, title and interest in and to the Lease in the event of: (a) a default by Assignor under the terms of the Lease and Assignor's failure to timely cure such default, assuming that such default is capable of curing; (b) a default by Assignor (in Assignor's capacity as a Bang Cookies Shop franchisee) under the terms and conditions of the Bang Cookies Shop Franchise Agreement between Assignor, as franchisee, and Assignee, as franchisor (the "Franchise Agreement"), and Assignor's failure to timely cure such default, assuming that such default is capable of curing; (c) upon default of any agreement supporting or guaranteeing the Franchise Agreement; or (d) the expiration or termination of the Franchise Agreement.
Assignor agrees that Assignor will not and shall not permit, grant or suffer any termination, surrender or modification of the Lease without the prior written consent of Assignee. Throughout the term of the
Franchise Agreement, Assignor shall elect and exercise all options to extend the terms of the or renewal of the Lease not less than 120 days prior to the last day that the option must be exercised unless Assignee otherwise agrees in writing. Should Assignor fail to comply with the foregoing, Assignor does hereby appoint Assignee (subject to Assignees acceptance and invocation of such right) to act on behalf of Assignor for the purpose of effectuating extensions and renewals of the Lease.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the franchisor, as the Assignee, has the right to take possession of the leased premises, eject the franchisee (Assignor), and terminate the franchisee's rights to the lease under specific circumstances. These circumstances include a default by the franchisee under the terms of the lease and failure to cure the default in a timely manner, assuming the default is curable.
Additionally, a Bang Cookies franchise can be dissolved if the franchisee defaults under the terms and conditions of the Bang Cookies Shop Franchise Agreement and fails to cure such default in a timely manner, assuming the default is capable of being cured. The franchise can also be dissolved upon default of any agreement supporting or guaranteeing the Franchise Agreement, or upon the expiration or termination of the Franchise Agreement itself.
The franchisee is prohibited from terminating, surrendering, or modifying the lease without the prior written consent of Bang Cookies. Furthermore, the franchisee must elect and exercise all options to extend the terms or renewal of the lease not less than 120 days prior to the last day that the option must be exercised, unless Bang Cookies agrees otherwise in writing. If the franchisee fails to comply with this requirement, Bang Cookies has the right to act on behalf of the franchisee to effectuate extensions and renewals of the lease, subject to Bang Cookies's acceptance and invocation of such right.
These stipulations ensure that Bang Cookies maintains control over the leased premises and can protect its interests in the event of franchisee default or failure to properly manage the lease. This is a fairly standard practice in franchising, as the location is often critical to the success of the business and the brand's reputation.