Does the Marble Slab Creamery franchisor have the right to review and reject a franchisee's lease?
Marble_Slab_Creamery Franchise · 2025 FDDAnswer from 2025 FDD Document
te permitted by Applicable Law, whichever is less, calculated on a daily basis, and a late charge of $125 per week for each week during which such payment is not received by Franchisor. Entitlement to such interest and late charge will be in addition to any other remedies Franchisor may have.
- 4.8 Upon Franchisor's demand, Franchisee shall reimburse Franchisor for its direct and indirect costs (including the reasonable value of Franchisor's employees and its Affiliates employees) incurred in connection with Franchisor's review of Franchisee's proposed lease or real estate purchase agreement, up to a maximum of $2,500, unless Franchisee has previously reimbursed Franchisor for its review of such lease or real estate purchase agreement. If Franchisor has reviewed and accepted Franchisee's lease or purchase agreement, such review and acceptance is solely for Franchisor's benefit and, is solely an indication that the lease or purchase agreement, as applicable, meets Franchisor's minimum standards and specifications at the time of acceptance. Such review and acceptance shall not be construed as any express or implied representation or warranty that an accepted lease or purchase agreement complies with applicable law or represents a transaction that is fair or is in Franchisee's best interest.
5. DUTIES OF FRANCHISEE
Franchisee understands and acknowledges that every detail of the Restaurant operated hereunder is important to Franchisee and Franchisor in order to develop and maintain high operating
standards, to increase the demand for the services and products sold by all Marble Slab Creamery franchisees, and to protect Franchisor's reputation and goodwill.
- 5.1 A Franchisee which is a corporation will comply, except as otherwise approved in writing by Franchisor, with the following requirements throughout the term of this Agreement:
- 5.1.1 Franchisee will furnish Franchisor with its Articles of Incorporation, By-laws, other governing documents, any other documents Franchisor may reasonably request, and any amendments thereto.
- 5.1.2 Franchisee will confine its activities exclusively to operating the Restaurant and any other "MARBLE SLAB CREAMERY" restaurants owned and operated by Franchisee pursuant to a validly existing franchise agreement.
- 5.1.3 Franchisee will maintain stop transfer instructions against the transfer on its records of any Equity securities;
Source: Item 22 — CONTRACTS (FDD page 101)
What This Means (2025 FDD)
According to the 2025 Marble Slab Creamery Franchise Disclosure Document, Marble Slab Creamery retains significant rights regarding the approval of a franchisee's lease. Specifically, prior to a renewal, a franchisee must present satisfactory evidence that they have the right to remain in possession of the current location for the duration of the renewal term. Alternatively, the franchisee can obtain Marble Slab Creamery's approval of a new location and lease, which Marble Slab Creamery may grant or withhold at its sole discretion. This indicates that Marble Slab Creamery has the authority to reject a lease if it does not meet their standards.
Furthermore, Marble Slab Creamery may demand reimbursement for costs associated with reviewing a franchisee's proposed lease or real estate purchase agreement, up to $2,500, unless the franchisee has previously reimbursed them for such a review. However, the FDD states that even if Marble Slab Creamery reviews and accepts a lease or purchase agreement, it is solely for their benefit and indicates only that the agreement meets their minimum standards at the time of acceptance. This acceptance does not constitute any representation or warranty that the agreement complies with applicable law or is in the franchisee's best interest.
In addition, the lease agreement includes a clause where the franchisee will be permitted to assign the lease to Marble Slab Creamery or its designee, in Marble Slab Creamery's sole right and discretion, and the landlord consents to such an assignment without any assignment fee or increase in rent. Marble Slab Creamery also has the right to enter the premises to make modifications or alterations necessary to protect the Marble Slab Creamery system and marks, cure any default under the Franchise Agreement or the Lease, or remove the distinctive elements of the Marble Slab Creamery trade dress upon the Franchise Agreement's expiration or termination.
These provisions collectively grant Marble Slab Creamery substantial control over the lease agreements of its franchisees, allowing them to ensure that the locations meet their standards, protect their brand, and maintain operational consistency across all franchise locations. Prospective franchisees should carefully consider these factors and understand the potential costs and limitations associated with lease negotiations and renewals.