What is the dependency between the Site Lease and the transfer of a Beem Light Sauna franchise?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, Company and Franchisee are parties to a Franchise Agreement dated (the "Franchise Agreement"); and WHEREAS, the Franchise Agreement provides that Franchisee will operate a beem® Light Sauna Studio ("Studio") at a location that Franchisee selects and Company accepts; and WHEREAS, Franchisee and Landlord propose to enter into the lease to which this Rider is attached (the "Lease"), pursuant to which Franchisee will occupy premises located at (the "Premises") for the purpose of constructing and operating the Studio in accordance with the Franchise Agreement; and
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.
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- 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.
(c) You fail to sign a Site Lease or purchase agreement that we have approved for a site that we have accepted by the Site Acquisition Deadline;
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- The provisions of this Lease Rider will supersede and control any conflicting provisions of the Lease.
Source: Item 23 — RECEIPT (FDD pages 71–230)
What This Means (2025 FDD)
According to the 2025 Beem Light Sauna Franchise Disclosure Document, the Site Lease is significantly intertwined with the franchise agreement and its potential transfer. The franchisee cannot assign the lease or sublet the premises without Beem Light Sauna's prior written consent, and the landlord must verify this consent before agreeing to any assignment or subletting. This gives Beem Light Sauna control over who occupies the franchise location.
Beem Light Sauna has the right to enter the premises to protect its brand and system, cure defaults, or remove trade dress upon termination of the franchise agreement. The franchisee is permitted to assign the lease to Beem Light Sauna or its designee upon the expiration or termination of the Franchise Agreement, and the landlord agrees to this without any fees or rent increases. If the lease is assigned to Beem Light Sauna, the assignee assumes all obligations from that point forward but is not responsible for prior defaults.
Furthermore, the Franchise Agreement stipulates that failure to sign a Site Lease approved by Beem Light Sauna for an accepted site by the Site Acquisition Deadline constitutes an event of default. This underscores the importance of securing an approved location and lease as a fundamental condition of the franchise agreement. The lease rider also specifies that its provisions supersede any conflicting terms in the lease itself, ensuring Beem Light Sauna's interests are prioritized.
These conditions ensure that Beem Light Sauna maintains control over the location and operation of its franchises, even in situations involving lease assignments or potential defaults. For a prospective franchisee, this means that the ability to transfer the franchise is heavily dependent on Beem Light Sauna's approval and the terms of the Site Lease, which are designed to protect the franchisor's interests.