Can a franchisee assign the lease to Pump It Up or its designee?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
(h) You may assign the lease to us or our designee with the landlord's consent (which consent will not be unreasonably withheld) and without payment of any assignment fee or similar charge or increase in any rentals payable to the landlord.
(i) The landlord agrees to consent to your collaterally assigning the lease to us or our designee, granting us the option, but not the obligation, to assume the lease from the date we take possession of the Premises, without payment of any assignment fee or similar charge or increase in any rentals payable to the landlord.
Our current form of Collateral Assignment of Lease is attached to this Agreement as Exhibit 2.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to the 2025 Pump It Up Franchise Disclosure Document, a franchisee may assign their lease to Pump It Up or its designee. However, this is contingent upon obtaining the landlord's consent, which, according to the FDD, will not be unreasonably withheld. Furthermore, this assignment can occur without any assignment fee or increase in rental payments to the landlord. Pump It Up also provides a form of Collateral Assignment of Lease as Exhibit 2 to the Franchise Agreement.
This provision protects Pump It Up by ensuring they can take over a desirable location if a franchisee fails or defaults. It also benefits the franchisee by clarifying the conditions under which the lease can be assigned, potentially simplifying the process. The landlord's consent is a standard requirement in commercial leases, and the agreement that such consent will not be unreasonably withheld provides some assurance to the franchisee.
It's important for prospective Pump It Up franchisees to carefully review the Collateral Assignment of Lease (Exhibit 2) and understand their rights and obligations regarding the lease assignment. They should also discuss this provision with a legal professional to fully grasp the implications and ensure the lease terms are favorable.