Under what conditions can Anago Assignee assume the lease and occupy the premises?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
NOW THEREFORE, in consideration of the foregoing premises and the mutual promises contained herein and, in the SRA, and in order to secure Assignor's obligations and Assignee's rights under the SRA, the parties agree as follows:
Assignor does hereby collaterally assign, transfer and set over unto Assignee, with the right to reassign (as provided by the Lease), all of its right, title and interest in and to the Lease and in and to the Premises, subject to the terms and conditions of this Collateral Assignment and to Landlord's consent.
Assignor shall retain right to possession of the Premises in accordance with the terms and conditions of the Lease until the declaration by Assignee of an Event of Default by Assignor under the SRA.
For purposes of this Agreement, the term "Event of Default" shall mean a default by Assignor under the SRA which remains uncured beyond all applicable notice and cure periods.
Upon: (a) the declaration of an Event of Default by Assignor under the SRA, (b) the expiration of the SRA, (c) termination of the SRA by Assignee for cause, or (d) an expression by Assignor of its desire to terminate the Lease, Assignee may, at its option, upon written notice to Landlord and Assignor, assume the Lease and occupy the Premises.
Upon exercise of this option, Assignee shall be deemed to be substituted as the tenant under the Lease in the place and stead of Assignor and shall be deemed to have assumed expressly all of the terms, covenants and obligations of the Lease therefore applicable to Assignor which arise after Assignee's assumption of the Lease and shall likewise be entitled to enjoy all of the rights and privileges granted to Assignor under the terms and conditions of the Lease.
Notwithstanding the foregoing, in the event Assignee exercises its rights under this paragraph 2, Assignor shall remain obligated under the Lease.
So long as Assignee shall not have exercised its option to take possession of the Premises under the foregoing provisions, Assignee shall not be liable for rent or any other obligation under the Lease, and Assignor shall remain liable for all such rent and obligations.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, Anago, as the Assignee, can assume the lease and occupy the premises under specific conditions related to the Assignor's (franchisee's) performance and the status of the Subfranchise Agreement (SRA).
Anago can assume the lease if one of the following events occurs: (a) the declaration of an Event of Default by the Assignor (franchisee) under the SRA, (b) the expiration of the SRA, (c) termination of the SRA by Anago for cause, or (d) an expression by the Assignor of its desire to terminate the lease. Upon the occurrence of any of these events, Anago has the option, with written notice to both the landlord and the Assignor, to assume the lease and occupy the premises.
Upon exercising this option, Anago is substituted as the tenant in place of the Assignor and assumes all terms, covenants, and obligations of the lease applicable to the Assignor that arise after Anago's assumption. Anago also gains all rights and privileges granted to the Assignor under the lease. However, even if Anago exercises its right to assume the lease, the Assignor remains obligated under the lease. Until Anago exercises its option to take possession, it is not liable for rent or any other obligations under the lease, with the Assignor remaining fully responsible for these.