What remedies does Atwell Suites have at law or in equity for breach of the Equipment Lease?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
- REMEDIES. Upon the occurrence of any Default or at any time thereafter during the continuance thereof, Company may terminate this Lease as to any or all items of Equipment, may enter Equipment Lessee's premises and retake possession of the Equipment at Equipment Lessee's expense, and will have all other remedies at law or in equity for breach of the Lease.
Equipment Lessee acknowledges that in the event of a breach of Sections 4 or 5 or a failure or refusal of Equipment Lessee to relinquish possession of the Equipment in breach of this section 12 following termination or Default, Company's damages may be difficult or impossible to ascertain, and Equipment Lessee therefore agrees that Company will have the right to seek an injunction in any court of competent jurisdiction restraining said breach and granting Company the right to immediate possession of the Equipment.
If Equipment Lessee acts in violation of the prohibitions described in Section 3 of this Lease, or is unable or unwilling to return the Equipment to Company in good working order, normal usage wear and tear excepted, at the expiration or termination of the Lease, Equipment Lessee will pay as liquidated damages the total of: (i) the amount of past-due lease payments, if any, discounted accelerated future lease payments, and the value of Company's residual interest in the Equipment, plus (ii) all tax indemnities associated with the Equipment to which Company would have been entitled if Equipment Lessee had fully performed this Lease, plus (iii) costs, interest, and attorneys' fees incurred by Company due to Equipment Lessee's violation of Section 3 or its failure to return the Equipment to Company, minus (iv) any proceeds or offset from the release or sale of the Equipment by Company.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to the 2025 FDD, Atwell Suites has specific remedies available in the event of a default or breach of the Equipment Lease by the Equipment Lessee. These remedies include the right to terminate the lease for any or all equipment items, enter the Equipment Lessee's premises to repossess the equipment at the Equipment Lessee's expense, and pursue all other available legal and equitable remedies for the breach.
In cases where the Equipment Lessee violates specific prohibitions within the lease, or fails to return the equipment in good working order upon the lease's expiration or termination, Atwell Suites can seek liquidated damages. These damages are calculated as the sum of past-due lease payments, discounted accelerated future lease payments, the value of Atwell Suites's residual interest in the equipment, and all tax indemnities associated with the equipment that Atwell Suites would have been entitled to if the Equipment Lessee had fully performed the lease. Additionally, Atwell Suites can recover costs, interest, and attorneys' fees incurred due to the Equipment Lessee's violation or failure to return the equipment, less any proceeds from the release or sale of the equipment by Atwell Suites.
Furthermore, if the Equipment Lessee breaches sections 4 or 5, or fails to relinquish possession of the equipment after termination or default, Atwell Suites has the right to seek an injunction in a competent court. This injunction would restrain the breach and grant Atwell Suites the immediate right to possess the equipment. This remedy acknowledges that calculating the exact damages to Atwell Suites in such situations may be difficult or impossible, thus justifying the need for injunctive relief.
These remedies provide Atwell Suites with multiple avenues to address breaches of the Equipment Lease, including monetary compensation through liquidated damages, repossession of equipment, and legal actions to prevent ongoing violations. The availability of both legal and equitable remedies ensures that Atwell Suites can choose the most appropriate course of action based on the specific circumstances of the breach, offering a comprehensive approach to protecting its interests.