If assignment of the lease is prohibited, what alternative action must the City Publications franchisee take?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Additionally, upon demand by Franchisor, Franchisee shall assign (or, if an assignment is prohibited, sublease for the full remaining term and on the same terms and conditions as Franchisee's lease) its interest in the lease then in effect for the premises of the Franchised Business to Franchisor, and Franchisee shall furnish Franchisor with evidence satisfactory to Franchisor of compliance with this obligation within thirty (30) days after termination or expiration of this Agreement.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to the 2025 City Publications Franchise Disclosure Document, if a City Publications franchisee is prohibited from assigning their lease to the franchisor, they must sublease the property to the franchisor for the full remaining term of the lease. The sublease must be on the same terms and conditions as the franchisee's original lease.
This requirement ensures that City Publications can maintain control over the location of the franchise business, even if the franchisee defaults or the franchise agreement is terminated. By subleasing the property, City Publications can continue operating the business at that location or transfer it to another franchisee without interruption.
This condition is important for prospective franchisees to consider, as it means they may be required to continue paying rent on the property even after the franchise agreement has ended if City Publications chooses to sublease the premises. Franchisees should carefully review the terms of their lease and understand their obligations in the event of termination or default.