Is the landlord required to permit the assignment of the lease to another Boulder Designs franchisee?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
Boulder Designs® 1 (e) If, during the six-month period set forth in section (d)(1) above, or at any time after the assignment contemplated in section (d)(2), Franchisor shall notify Landlord that the franchise for the Business is being granted to another Boulder Designs franchisee, Landlord shall permit the assignment of the Lease to said
franchisee without the payment of any fee or other cost requirement, provided that, said franchisee meets Landlord's reasonable financial qualifications. Landlord shall not unreasonably withhold consent to such assignment. Thereafter, Franchisor shall be released from any and all further liabilities under the Lease. The parties agree to execute any commercially reasonable documents in furtherance of this section.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, under certain conditions, the landlord is required to permit the assignment of the lease to another Boulder Designs franchisee. Specifically, if Boulder Designs notifies the landlord that the franchise for the business is being granted to another franchisee, the landlord must allow the lease assignment. This provision applies if the notification occurs during a six-month period where Boulder Designs is performing the lease terms on behalf of the tenant or at any time after Boulder Designs has formally assumed the lease.
This requirement is contingent upon the new franchisee meeting the landlord's reasonable financial qualifications. The landlord is also prohibited from unreasonably withholding consent to the assignment. This stipulation aims to facilitate the smooth transition of the business to a new franchisee, ensuring business continuity and minimizing disruptions.
For a prospective Boulder Designs franchisee, this clause offers a degree of security. If the franchisee needs to transfer their business to another franchisee, the lease can be assigned, provided the financial criteria are met and the landlord's consent is not unreasonably withheld. This can be a significant advantage, as it avoids the complexities and potential costs associated with breaking a lease or negotiating a new one. However, it's important to note that the landlord still has the right to assess the financial stability of the incoming franchisee.