What must a BNC Transferee agree to in writing when Benihana assigns its rights?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.1 BNC has the right to and may assign its rights under this Agreement to any person, firm, association or corporation ("BNC Transferee") provided that the BNC Transferee agrees in writing to assume all of BNC's obligations under this Agreement. Upon any assignment by BNC and assumption by the BNC Transferee of BNC's obligations under this Agreement, BNC shall have no further obligations or liabilities under this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, if Benihana assigns its rights under the Franchise Agreement to another entity (referred to as a "BNC Transferee"), that BNC Transferee must agree in writing to assume all of Benihana's obligations under the Franchise Agreement. This means the new entity takes on all of Benihana's responsibilities and commitments to the franchisee. Once the BNC Transferee assumes these obligations in writing, Benihana is relieved of any further liabilities or responsibilities under the agreement.
This provision protects the franchisee in the event of a transfer. It ensures that the franchisee's rights and the franchisor's obligations remain intact even if the original franchisor is no longer involved. The franchisee can expect the same level of support and adherence to the franchise agreement terms from the new franchisor.
For a prospective Benihana franchisee, this clause offers some security. It means that if Benihana sells the franchise system, the new owner is legally bound to uphold the promises and obligations outlined in the franchise agreement. However, it is important for the franchisee to carefully review the terms of the agreement to fully understand the scope of these obligations and to seek legal counsel if needed.