Can Bimbo Foods Bakeries Distribution assign the lease without notice to the Lessee?
Bimbo_Foods_Bakeries_Distribution Franchise · 2025 FDDAnswer from 2025 FDD Document
Lessor may assign this Lease in whole or part without notice to Lessee.
Lessor's Assignee shall have all of the rights, but none of the obligations of Lessor hereunder.
Lessor's Financing.
Lessor may assign to a lender or lenders, a security Interest in Equipment and the right to receive rents and other sums due hereunder.
Upon notice of such assignment in writing by a lender (not Lessor).
Lessee shall pay all rents and other sums due, or to become due under this Lease directly to assignee without set off, counterclaim, or any defense whatsoever without claim for same by Lessor.
Source: Item 14 — Other Accounts Payable and Accrued Liabilities (FDD pages 312–476)
What This Means (2025 FDD)
According to Bimbo Foods Bakeries Distribution's 2025 Franchise Disclosure Document, the lessor (Bimbo Foods Bakeries Distribution) has the right to assign the lease in whole or in part without providing notice to the lessee (the franchisee). This means that Bimbo Foods Bakeries Distribution can transfer its rights and interests in the lease to another party without requiring the franchisee's consent or even informing them beforehand. The assignee then assumes all the rights, but not the obligations, of Bimbo Foods Bakeries Distribution under the lease.
This clause could have significant implications for a prospective Bimbo Foods Bakeries Distribution franchisee. If the lease is assigned, the franchisee will be required to direct all lease payments and other sums due under the lease directly to the assignee, without any right to offset, counterclaim, or defense against the assignee. This obligation arises upon written notice of the assignment from the lender, not from Bimbo Foods Bakeries Distribution itself.
Furthermore, Bimbo Foods Bakeries Distribution may assign a security interest in the equipment and the right to receive rents and other sums due under the lease to a lender. This is part of Lessor's Financing, allowing them to leverage the lease for financial purposes. The franchisee's obligations remain unchanged, but their payments are redirected to the lender upon notice. It is important for a prospective franchisee to understand these terms and conditions, as failure to comply with the lease terms could result in default and potential termination of the lease.