When does Bens Soft Pretzels become responsible for lease obligations if it assumes the lease?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Franchisor, upon taking possession of the Premises, shall cure any default specified by Landlord within the timeframes noted herein and shall execute and deliver to Landlord its assumption of Tenant's rights and obligations under the Lease. Franchisor shall pay, perform and be bound by all the duties and obligations of the Lease applicable to Tenant, except that the Franchisor may elect not to assume or be bound by the terms of any Amendment to the Lease executed by Tenant without obtaining Franchisor's prior written approval, which shall not be unreasonably withheld or delayed.
- (c) At or after the time Franchisor assumes Tenant's interests under the Lease, the Franchisor may, at any time, assign such interests or sublet the Premises to a BEN'S SOFT PRETZELS franchisee. Any such assignment shall be subject to the prior written consent of the Landlord, which Landlord shall not unreasonably withhold as it relates to a creditworthy franchisee who otherwise meets Franchisor's then-current standards and requirements for franchisees and agrees to operate the Store as a BEN'S SOFT PRETZELS Store pursuant to a Franchise Agreement with Franchisor. Upon receipt by Landlord of an assumption agreement pursuant to which the assignee agrees to assume the Lease and to observe the terms, conditions and agreements on the part of Tenant to be performed under the Lease, the Franchisor shall thereupon be released from all liability as tenant under the Lease from and after the date of assignment, without any need of a written acknowledgement of such release by Landlord.
Source: Item 22 — CONTRACTS (FDD pages 46–47)
What This Means (2025 FDD)
According to Bens Soft Pretzels's 2025 Franchise Disclosure Document, if Bens Soft Pretzels elects to assume a lease, it takes on the tenant's rights and obligations under the lease upon taking possession of the premises. Specifically, Bens Soft Pretzels must address any defaults specified by the landlord within the timeframes provided and formally execute and deliver its assumption of the tenant's obligations. However, Bens Soft Pretzels has the option not to be bound by any lease amendments the tenant made without Bens Soft Pretzels's prior written approval, provided that such approval is not unreasonably withheld or delayed.
This means that a prospective Bens Soft Pretzels franchisee should understand the terms of the original lease and any subsequent amendments. The franchisee should also be aware that Bens Soft Pretzels will only assume the lease if it cures any existing defaults. This clause protects Bens Soft Pretzels from hidden liabilities and gives it some flexibility in deciding whether to accept all the lease terms.
Furthermore, after Bens Soft Pretzels assumes the lease, it has the right to assign the lease or sublet the premises to another Bens Soft Pretzels franchisee, subject to the landlord's prior written consent. The landlord cannot unreasonably withhold consent if the new franchisee is creditworthy, meets Bens Soft Pretzels's standards, and agrees to operate the store according to a Franchise Agreement with Bens Soft Pretzels. Once the landlord receives an assumption agreement from the new franchisee, Bens Soft Pretzels is released from all liability under the lease from the date of assignment forward, without needing written acknowledgment from the landlord.
This arrangement provides Bens Soft Pretzels with flexibility in managing its franchise locations and ensures that franchisees meet certain standards. For a potential franchisee, it highlights the importance of understanding the lease terms and the conditions under which Bens Soft Pretzels might assume or assign the lease. It also clarifies the franchisee's responsibilities in maintaining the standards required by Bens Soft Pretzels and obtaining necessary approvals for any lease modifications.