Can a My Salon Suite tenant revoke the assignment of the lease to the Franchisor?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
- G. Acceptance of Assignment by Franchisor. Subject to complying with the requirements of this Section, Franchisor may accept the assignment of the Lease by giving written notice of acceptance to Landlord at any time before the Lease terminates or expires if: (i) Franchisor terminates the Franchise Agreement for any reason; (ii) Tenant loses the right to occupy the Premises due to Tenant's breach or default or for any other reason except the expiration of the Lease or condemnation or destruction of the Premises on the terms stated in the Lease. If Franchisor accepts the assignment by giving timely written notice to both Franchisee and Landlord, the parties agree that from and after the date of Franchisor's written notice of acceptance: (i) Franchisor shall have all of the rights of Tenant under the Lease; (ii) Franchisor shall have the right to assign or sublet all of any part of its interest in the Lease or in the Premises to another Franchised Business owner without Landlord's prior consent; and (iii) Franchisor shall be liable to perform only the obligations of Tenant under the Lease arising from and after the date of Franchisor's acceptance of the assignment and shall have no liability for obligations arising before Franchisor's acceptance of the assignment (except for the duty to cure any defaults committed by Tenant which are outstanding on the date of Franchisor's notice of acceptance of assignment). Any options to extend the term of the Lease shall automatically transfer to Franchisor as an assignee of Tenant's rights under the Lease. If Franchisor accepts an assignment of the Lease, the parties shall thereafter cooperate and work together to achieve an orderly transition of Tenant's leasehold interest to Franchisor with minimal disruption to the service of customers of the Franchised Business.
Source: Item 23 — RECEIPTS (FDD pages 95–230)
What This Means (2025 FDD)
The 2025 My Salon Suite Franchise Disclosure Document outlines the conditions under which the franchisor may accept the assignment of a lease, but it does not explicitly state whether a tenant (franchisee) can revoke this assignment once it has been initiated or completed. The document details the franchisor's rights and obligations regarding the lease, particularly in situations where the franchisee defaults or the franchise agreement is terminated.
Specifically, My Salon Suite can accept the assignment of the lease by providing written notice to the landlord before the lease terminates or expires if the Franchise Agreement is terminated for any reason, or if the tenant loses the right to occupy the premises due to breach, default, or any reason other than the lease's expiration, condemnation, or destruction of the premises. Once the franchisor accepts the assignment, it assumes all the tenant's rights under the lease and can assign or sublet the premises to another franchisee without the landlord's prior consent. The franchisor is then liable for the tenant's obligations under the lease from the date of acceptance, including curing any outstanding defaults committed by the tenant.
However, the FDD does not address the possibility of the franchisee revoking the assignment after My Salon Suite has accepted it. A prospective franchisee should seek clarification from My Salon Suite regarding the possibility and conditions under which an assignment might be revoked, as well as any potential penalties or liabilities associated with such a revocation. Understanding these conditions is crucial for franchisees to make informed decisions about their lease agreements and business operations.