Under what conditions can the sublessor terminate the Browns Chicken sublease?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary herein contained and without limitation of any right of Sublessor contained herein, Sublessor shall have the right to terminate this Sublease upon the happening of any of the following events:
(a) default by Sublessee hereunder;
(b) termination, for any reason, of the franchise granted by Sublessor to Sublessee pursuant to Franchise Agreement which will commence as of the day the Premises is opened for business by Sublessee;
(c) the suffering or permission by Sublessee of the occurrence of any act or thing which would constitute an event of default by Sublessor in its capacity as Tenant under the Lease; or
(d) cancellation or termination of the Lease, for any reason, prior to the expiration date hereof; provided that if such cancellation or termination of the Lease is due to any default of Sublessor in its capacity as Lessee, Sublessee shall have the right to cure any such default to the extent permitted by the Lease.
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- Notwithstanding the provisions of Paragraph 7 hereof as it incorporates the default provisions of the Lease, it shall be an event of default hereunder if Sublessee has not made payment of any rental installment, or any other item to be paid hereunder within three (3) days of receipt by Sublessee of written notice thereof from Sublessor.
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- Sublessee shall not assign or in any manner transfer this Sublease or any interest herein or further sublet the Premises or any portion thereof, nor permit occupancy by any other person without the prior written consent of Sublessor; provided that in any and all events Sublessee shall remain primarily liable hereunder.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to the 2025 Browns Chicken Franchise Disclosure Document, the sublessor has the right to terminate the sublease under specific conditions. These conditions include default by the sublessee, termination of the franchise agreement for any reason, any act or event that would constitute a default by the sublessor under the original lease, or cancellation/termination of the original lease for any reason before its expiration date. However, if the lease cancellation or termination results from the sublessor's default as the lessee, the sublessee has the right to cure the default if permitted by the lease.
Furthermore, the Browns Chicken FDD specifies that failure to pay any rental installment or other payment within three days of receiving written notice from the sublessor also constitutes an event of default. The sublessee is also prohibited from assigning or transferring the sublease or any interest in it, or from further subletting the premises without the sublessor's prior written consent. Even with consent, the sublessee remains primarily liable under the sublease.
These stipulations in the Browns Chicken sublease agreement are important for prospective franchisees to understand. They outline the circumstances under which they could lose their location and the responsibilities they hold even if they sublet the property to another party. Franchisees should carefully review the lease and sublease agreements with legal counsel to fully grasp their obligations and potential risks.