What happens to the Endless Summer Sweets franchise if the franchisee loses possession of the location?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
ETS FRANCHISE AGREEMENT**
RIDER TO LEASE AGREEMENT
| Landlord: Notice Address: | Franchisor: Endless Summer Sweets Franchising, Inc. |
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| Telephone: | Notice Address and Telephone: 2358 Shattuck Avenue, Berkeley, California 94704 415-286-4687 |
| Tenant: | |
| Leased Premises: |
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- Use. Tenant is a franchisee of Franchisor. The Leased Premises shall be used only for the operation of an Endless Summer Sweets business (or any name authorized by Franchisor).
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- Notice of Default and Opportunity to Cure. Landlord shall provide Franchisor with copies of any written notice of default ("Default") given to Tenant under the Lease, and Landlord grants to Franchisor the option (but not the obligation) to cure any Default under the Lease (should Tenant fail to do so) within ten (10) days after the expiration of the period in which Tenant may cure the Default.
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- Termination of Lease. Proprietor shall copy Franchisor on any notice of termination of the Lease. If Landlord terminates the Lease for Tenant's Default, Franchisor shall have the option to enter into a new Lease with Landlord on the same terms and conditions as the terminated Lease. To exercise this option, Franchisor must notify Landlord within fifteen (15) days after Franchisor receives notice of the termination of the Lease.
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- Termination of Franchise Agreement. If the Franchise Agreement between Franchisor and Tenant is terminated during the term of the Lease, then upon the written request of Franchisor, Tenant shall assign the Lease to Franchisor. Landlord hereby consents to the assignment of the Lease to Franchisor.
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- Assignment and Subletting. Notwithstanding any provision of the Lease to the contrary, Tenant shall have the right to assign or sublet the Lease to Franchisor, provided that no such assignment or sublease shall relieve Tenant or any guarantor of liability under the Lease. If Franchisor becomes the lessee of the Leased Premises, then Franchisor shall have the right to assign or sublease its lease to a franchisee of the Endless Summer Sweets brand. Any provision of
the Lease which limits Tenant's right to own or operate other Endless Summer Sweets outlets in proximity to the Leased Premises shall not apply to Franchisor.
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- Authorization.
Source: Item 23 — RECEIPTS (FDD pages 39–125)
What This Means (2024 FDD)
According to the 2024 Endless Summer Sweets Franchise Disclosure Document, if a franchisee's lease is terminated due to default, Endless Summer Sweets has the option to enter into a new lease with the landlord under the same terms as the original lease. To exercise this option, Endless Summer Sweets must notify the landlord within fifteen days of receiving notice of the lease termination.
Additionally, if the Franchise Agreement between Endless Summer Sweets and the tenant is terminated during the lease term, the tenant must assign the lease to Endless Summer Sweets upon written request from Endless Summer Sweets, a condition to which the landlord consents. If Endless Summer Sweets becomes the lessee, it has the right to assign or sublease the premises to another Endless Summer Sweets franchisee.
Furthermore, upon the expiration or termination of the Franchise Agreement or the Lease, or the termination of Tenant's right of possession of the Leased Premises, Endless Summer Sweets or its designee may, after giving reasonable prior notice to Landlord, enter the Leased Premises to remove signs and other material bearing Endless Summer Sweets's brand name, trademarks, and commercial symbols, provided that Endless Summer Sweets will be liable to Landlord for any damage Endless Summer Sweets or its designee causes by such removal.
This arrangement protects Endless Summer Sweets's interests by allowing them to maintain a location and continue operations, either directly or through another franchisee, even if the original franchisee loses possession of the location. It also ensures the removal of Endless Summer Sweets branding if the location is no longer operating as an Endless Summer Sweets franchise, preventing consumer confusion.