What happens to an Atwell Suites equipment lease if the agreement is terminated?

According to Atwell Suites's 2025 Franchise Disclosure Document, the termination of the License Agreement does not automatically terminate any existing equipment lease. The franchisee remains obligated to fulfill the terms of the equipment lease, even if the main franchise agreement is terminated. This means that the franchisee must continue to make rental payments until the equipment is fully paid for or returned to Atwell Suites.

Specifically, the franchisee's obligation to make rental payments continues until the rented equipment is either fully paid for or returned to Atwell Suites. This ensures that Atwell Suites is compensated for the use of its equipment, regardless of the status of the overarching franchise agreement. This provision protects Atwell Suites's investment in the equipment and ensures a steady revenue stream from the lease agreements.

This arrangement is fairly common in franchising, as equipment leases are often structured as separate agreements to provide additional security for the franchisor. Prospective Atwell Suites franchisees should carefully review the terms of both the franchise agreement and the equipment lease to fully understand their obligations upon termination of either agreement. Understanding these obligations is crucial for financial planning and risk management.