What is the condition regarding the terms of the lease for the Closet Storage Concepts Approved Location?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee will occupy the Approved Location under a lease, Franchisee shall negotiate and execute a lease for the site with the landlord of the showroom site on terms satisfactory to Franchisor; provided, however, that, prior to execution of the lease, Franchisee shall submit a copy of the lease to Franchisor for its written approval.
- 1.3.1 Franchisor shall not approve any lease for the proposed location unless it contains certain provisions, including (i) a limitation that the premises shall be used only for a Closet & Storage Concepts business; (ii) a prohibition against assignment, subletting exercise or non-exercise of any option to extend, renew or purchase by Franchisee without Franchisor's prior written approval; (iii) permission for Franchisor to enter the premises and make changes to protect the Proprietary Marks; (iv) Franchisor will be given prior written notice of and have the option to cure any default of Franchisee under the lease; (v) the layout, sign usage and hours of operation of the Franchised Business as proposed in the Agreement and Operations Manual are permitted under the terms of the lease; and (vi) the lessor will agree not to lease premises in the immediate vicinity of the Approved Location to competing retail establishments that sell custom closet and garage storage services or related retail products and items without Franchisor's prior written consent.
The lease shall be for a term at least equal to the term of this Agreement or, in the alternative, for a shorter term provided the lease is renewable at the option of Franchisee for an additional term or terms which, together with the initial term, equal or exceed the term of this Agreement.
The lease must also contain general business terms acceptable to Franchisor.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, if a franchisee chooses to lease the Approved Location, they must negotiate and execute a lease with the landlord on terms that are satisfactory to Closet Storage Concepts. Prior to signing the lease, the franchisee must submit a copy of the lease to Closet Storage Concepts for written approval.
Closet Storage Concepts will not approve any lease unless it contains specific provisions. These include: the premises can only be used for a Closet & Storage Concepts business; the franchisee is prohibited from assigning or subletting the lease, or exercising any options to extend, renew, or purchase the property without Closet Storage Concepts' prior written approval; Closet Storage Concepts has permission to enter the premises and make changes to protect their Proprietary Marks; Closet Storage Concepts will receive prior written notice of any franchisee default under the lease and have the option to cure it; the lease permits the layout, sign usage, and hours of operation as proposed in the Franchise Agreement and Operations Manual; and the lessor agrees not to lease premises in the immediate vicinity to competing retail establishments without Closet Storage Concepts' prior written consent.
The lease term must be at least equal to the term of the Franchise Agreement. If the lease term is shorter, it must be renewable at the franchisee's option for additional terms that, combined with the initial term, equal or exceed the term of the Franchise Agreement. Additionally, the lease must contain general business terms acceptable to Closet Storage Concepts. This ensures that Closet Storage Concepts maintains control over the location and operation of its franchises, protecting its brand and system standards.