factual

If the Beauty Bungalows franchisee assigns the agreement, are they still bound by certain provisions?

Beauty_Bungalows Franchise · 2025 FDD

Answer from 2025 FDD Document

Beauty Bungalows Franchising, LLC 257 Wake Forest Road Costa Mesa, CA 92626 Franchise@BeautyBungalows.com

    1. Company will have the right, without being guilty of trespass or any other crime or tort, to enter the Premises at any time or from time to time (i) to make any modification or alteration it considers necessary to protect the Beauty Bungalows system and marks, (ii) to cure any default under the Franchise Agreement or under the Lease, or (iii) to remove the distinctive elements of the Beauty Bungalows trade dress upon the Franchise Agreement's expiration or termination. Neither Company nor Landlord will be responsible to Franchisee for any damages Franchisee might sustain as a result of action Company takes in accordance with this provision. Company will repair or reimburse Landlord for the cost of any damage to the Premises' walls, floor or ceiling that result from Company's removal of trade dress items and other property from the Premises.
    1. Franchisee will be permitted to assign the Lease to Company or its designee upon the expiration or termination of the Franchise Agreement. Landlord consents to such an assignment and agrees not to impose any assignment fee or similar change, or to increase or accelerate rent under the Lease, in connection with such an assignment.
    1. If Franchisee assigns the Lease to Company or its designee in accordance with the preceding paragraph, the assignee must assume all obligations of Franchisee under the Lease from and after the date of assignment, but will have no obligation to pay any delinquent rent or to cure any other default under the Lease that occurred or existed prior to the date of the assignment.
    1. Franchisee may not assign the Lease or sublet the Premises without Company's prior written consent, and Landlord will not consent to an assignment or subletting by Franchisee without first verifying that Company has given its written consent to Franchisee's proposed assignment or subletting.
    1. Landlord and Franchisee will not amend or modify the Lease in any manner that could materially affect any of the provisions or requirements of this Lease Rider without Company's prior written consent.
    1. The provisions of this Lease Rider will supersede and control any conflicting provisions of the Lease.
    1. Landlord acknowledges that Company is not a party to the Lease and will have no liability or responsibility under the Lease unless and until the Lease is assigned to, and assumed by, Company.

Source: Item 22 — CONTRACTS (FDD pages 47–48)

What This Means (2025 FDD)

According to Beauty Bungalows' 2025 Franchise Disclosure Document, if a franchisee assigns the lease to Beauty Bungalows or its designee, the assignee assumes all the franchisee's obligations under the lease from the assignment date. However, the assignee is not obligated to pay any delinquent rent or resolve any defaults that existed before the assignment date. This means that while the new party taking over the lease is responsible for ongoing obligations, the original franchisee remains liable for any outstanding issues prior to the transfer.

Furthermore, the Beauty Bungalows franchisee cannot assign the lease or sublet the premises without the prior written consent of Beauty Bungalows. The landlord also requires verification that Beauty Bungalows has given written consent before agreeing to any assignment or subletting. Additionally, the landlord and franchisee cannot modify the lease in any way that could materially affect the lease rider's provisions without Beauty Bungalows' prior written consent. These stipulations ensure that Beauty Bungalows maintains control over the location and terms of the franchise operation, even if the franchisee changes.

Beauty Bungalows also retains certain rights regarding the premises. Beauty Bungalows has the right to enter the premises to make modifications to protect the Beauty Bungalows system and marks, cure any default under the Franchise Agreement or lease, or remove distinctive elements of the Beauty Bungalows trade dress upon the agreement's expiration or termination. Neither Beauty Bungalows nor the landlord is responsible for any damages the franchisee might sustain as a result of these actions. Beauty Bungalows will repair or reimburse the landlord for any damage to the premises resulting from the removal of trade dress items. These provisions allow Beauty Bungalows to maintain brand standards and control over the franchise location, even after the franchise agreement ends.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.