Does the Bens Soft Pretzels sublicense agreement require obtaining insurance?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.3 Insurance. Sublicensee will not permit the Premises to be used in any manner which would render the insurance thereon void or the insurance risk more hazardous. Sublicensee shall not use or occupy the Premises, or permit the Premises to be used or occupied, contrary to any statute, rule, order, ordinance, requirement or regulation applicable thereto; or in any manner which would violate any certificate of occupancy affecting the same; or which would cause structural injury to the improvements; or cause the value or usefulness of the Premises, or any part thereof, to diminish; or which would constitute a public or private nuisance or waste. Sublicensee shall keep and maintain in full force and effect throughout the term of the Sublicense and at Sublicensee's sole cost and expense, all insurance in the form and amounts described in the License and the Franchise Agreement, and naming Franchisor, Sublicensor (and to the extent applicable, Licensor) as an additional insured on all of same.
Source: Item 22 — CONTRACTS (FDD pages 46–47)
What This Means (2025 FDD)
According to the 2025 Bens Soft Pretzels Franchise Disclosure Document, if a franchisee enters into a sublicense agreement, they are required to obtain and maintain insurance coverage. The franchisee (referred to as "Sublicensee" in the sublicense context) must ensure that the premises are not used in any way that could jeopardize the insurance or increase the insurance risk.
The Sublicensee is responsible for maintaining insurance throughout the term of the sublicense agreement, covering the costs and ensuring the insurance is in the form and amounts detailed in both the License and the Franchise Agreement. This insurance must name the Franchisor, Sublicensor, and, if applicable, the Licensor as additional insured parties.
This requirement ensures that all parties involved are protected against potential liabilities and risks associated with the operation of the Bens Soft Pretzels store. The franchisee needs to carefully review the insurance requirements outlined in the Franchise Agreement and License to secure appropriate coverage and remain compliant with the sublicense terms.