After assignment of the lease for the Center premises, which obligations does Brain Balance assume?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.05. In the event FRANCHISEE leases office space for the Franchised Business, such lease shall contain a conditional assignment clause, substantially similar to the template provided in Exhibit 5, that shall provide that upon the expiration or sooner termination of this Agreement, for any reason contained herein, the FRANCHISOR or its Affiliates shall have the option, exercisable within thirty (30) days after said expiration or termination, to assume the obligations of the lease, to replace FRANCHISEE and enter into possession under said lease or at any time prior thereto or thereafter to assign or reassign the lease to a third party. In connection therewith, FRANCHISEE shall execute a Conditional Assignment of Lease in the form attached hereto as Exhibit 5 (the "Assignment") pursuant to which Assignment FRANCHISEE has assigned to FRANCHISOR all its right, title, and interest in the lease for the Franchised Business. FRANCHISEE acknowledges that such Assignment is freely assignable by FRANCHISOR to any other person or entity, including any person or entity that may acquire the right to operate a Brain Balance® business in and from said office location or otherwise within the Territory.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, if a franchisee leases office space for their Brain Balance center, the lease must include a conditional assignment clause. This clause allows Brain Balance, at its option, to assume the obligations of the lease if the franchise agreement expires or terminates. Brain Balance has 30 days after the expiration or termination to exercise this option.
Specifically, Brain Balance has the option to replace the franchisee and take possession of the leased premises. Alternatively, Brain Balance can assign or reassign the lease to another party at any time before or after taking possession. The franchisee is required to execute a Conditional Assignment of Lease, giving Brain Balance all rights, title, and interest in the lease.
This assignment is freely transferable by Brain Balance to any other person or entity, including someone who may acquire the right to operate a Brain Balance business at that location or within the territory. This clause protects Brain Balance by ensuring they can maintain control over the location of a franchise even if the franchisee leaves the system.