What happens to the Big O Tires lease if the franchisee's Franchise Agreement is terminated?
Big_O_Tires Franchise · 2025 FDDAnswer from 2025 FDD Document
Landlord agrees that if the Franchise Agreement between Tenant and Big O is terminated, then, Big O shall have the right to:
- (a) immediate and actual possession of the Premises, and, subject only to existing liens of record, all equipment and inventory therein, which such possession Tenant agrees to give peaceably, and which may be otherwise obtained by Big O by warrant, injunction, temporary restraining order, summary process or such other immediate legal, summary or equitable proceeding or action as Big O may choose.
Tenant hereby waives any right to a jury in any such proceeding or action.
- (b) become the Tenant under the Lease to the exclusion of the Tenant.
Source: Item 23 — RECEIPTS (FDD pages 102–535)
What This Means (2025 FDD)
According to the 2025 Big O Tires Franchise Disclosure Document, if the Franchise Agreement between the tenant (franchisee) and Big O Tires is terminated, Big O Tires has specific rights regarding the premises. Big O Tires has the right to immediate and actual possession of the premises, including all equipment and inventory, subject to existing liens of record. The franchisee agrees to provide peaceful possession, which Big O Tires can also obtain through legal means such as a warrant, injunction, or summary process. Additionally, Big O Tires has the right to become the tenant under the lease, excluding the original franchisee.
Big O Tires may elect to assume the tenant's obligations to the landlord under the lease upon gaining possession of the premises. If Big O Tires takes over, it is not required to cure any default of the tenant. However, the landlord must complete any of the tenant's deferred maintenance obligations within 60 days of Big O Tires' election. As a substitute tenant, Big O Tires, or its affiliate or successor, can sublet the premises to a new Big O Tires franchisee without the landlord's consent during the remaining lease term and options.
The landlord and tenant (franchisee) agree not to modify or amend the lease without Big O Tires' consent, which will not be unreasonably withheld. All parties understand that Big O Tires enters into the Franchise Agreement with the tenant in reliance on these agreements. These provisions ensure that Big O Tires has control over the location and can continue operating a Big O Tires store at the premises even if the original franchisee's agreement is terminated.