Under what condition can Best Brains request the assignment of a lease for the franchised business premises?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Landlord, Franchisor and the Franchisee hereby agree as follows:
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- The Premises may be used only for the operation of a Best Brains business.
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- Landlord shall deliver to the Franchisor a copy of any notice of default or termination of the Lease at the same time such notice is delivered to the Franchisee, but no later than thirty (30) days before a termination of the Lease would become effective.
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- The Franchisor shall have the right, but not the obligation, upon giving prior written notice of its election to the Franchisee and Landlord, to enter the Premises to cure any breach of the Lease, and if so stated in the notice, to also succeed to the Franchisee's rights, title, and interests thereunder.
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- Notwithstanding anything to the contrary contained in the Lease, and subject to Paragraph 1 of this Rider, the Franchisee shall have the absolute right to sublet, assign or otherwise transfer its interest in the Lease to the Franchisor or its affiliate, or to a company with which the Franchisee or the Franchisor may merge or consolidate, without Landlord's approval, written or otherwise, without any increase in rent (except as provided in the Lease), without a material change in any other terms of the Lease, and without execution of any additional guaranty of the obligations under the assigned Lease.
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- Subject to Paragraph 1 of this Rider, the Franchisee shall, if requested by the Franchisor, assign to the Franchisor (or its affiliate or to a company with which the Franchisee or the Franchisor may merge or consolidate), and Landlord hereby irrevocably and unconditionally consents to such assignment, all of the Franchisee's rights, title, and interest to and under the Lease upon (i) any termination of the Lease or the Franchise Agreement or (ii) if no subsequent Franchise Agreement is executed; but no such assignment shall be effective unless: (a) the Franchise Agreement is terminated or expires without execution of a renewal Franchise Agreement; and (b) the Franchisor (or its affiliate or a company with
which the Franchisee or the Franchisor may merge or consolidate), notifies the Franchisee and Landlord in writing that it assumes the Franchisee's obligations under the Lease.
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- In addition to any prior written consent of the Landlord that may be required by the terms of the Lease: (a) the Lease may not be modified, amended, renewed or extended in any manner or assigned by the Franchisee without the Franchisor's prior written consent; (b) the Premises may not be altered or modified in any way without the Franchisor's prior written consent; and (c) the Premises may not be sublet, subdivided or used for any purpose other than for the operation of a Best Brains business without the Franchisor's prior written consent.
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Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, Best Brains can request the assignment of a lease under specific conditions. The franchisee must assign all rights, title, and interest in the lease to Best Brains (or its affiliate, or a company with which the franchisee or Best Brains may merge or consolidate) if the Franchise Agreement or the lease is terminated. This also applies if no subsequent Franchise Agreement is executed.
However, this assignment is only effective if two conditions are met. First, the Franchise Agreement must be terminated or expired without a renewal Franchise Agreement. Second, Best Brains must notify both the franchisee and the landlord in writing that it is assuming the franchisee's obligations under the lease.
Furthermore, the franchisee has the absolute right to assign the lease to Best Brains, its affiliate, or a company with which it may merge or consolidate, without the landlord's approval. This can occur without any increase in rent (except as provided in the lease), without a material change in any other terms of the lease, and without the need for any additional guaranty of obligations under the assigned lease.