What happens if Canopy Lawn Care defaults on the lease?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
rected by Lessor. Providing false information or failure to complete the odometer disclosure form as required by law may result in nes and/or imprisonment. Lessee hereby agrees to promptly deliver to Lessor such nancial statements and other nancial information regarding Lessee as Lessor may from time to time reasonably request.
-
- DEFAULT; REMEDIES: The following shall constitute events of default ("Events of Default") by Lessee under this Agreement: (a) if Lessee fails to pay when due any rent or other amount due under this Agreement and any such failure shall remain unremedied for ten (10) days; (b) if Lessee fails to perform, keep or observe any term, provision or covenant contained in Section 11 of this Agreement; (c) if Lessee fails to perform, keep or observe any other term, provision or covenant contained in this Agreement and any such failure shall remain unremedied for thirty (30) days after written notice thereof is given by Lessor, Servicer or any other agent of Lessor to Lessee; (d) any seizure or con scation of any Vehicle or any other act (other than a Casualty Occurrence) otherwise rendering any Vehicle unsuitable for use (as determined by Lessor); (e) if any present or future guaranty in favor of Lessor of all or any portion of the obligations of Lessee under this Agreement shall at any time for any reason cease to be in full force and effect or shall be declared to be null and void by a court of competent jurisdiction, or if the validity or enforceability of any such guaranty shall be contested or denied by any guarantor, or if any guarantor shall deny that it, he or she has any further liability or obligation under any such guaranty or if any guarantor shall fail to comply with or observe any of the terms, provisions or conditions contained in any such guaranty; (f) the occurrence of a This document was downloaded from franchimp.com. All the information on this website is published in good faith and for general information purpose only. FranChimp.com does not make any warranties about the completeness, reliability, and
accuracy of this information. Any action you take upon the information you find on this website (FranChimp.com), is strictly at your own risk. We will not be liable for any losses and/or damages in connection with the use of our website.
| -- | -- | ------------------------ |
|---|
material adverse change in the nancial condition, a going concern audit comment of Lessee or any guarantor, or if Lessee admits that it cannot pay its debts as they become due, makes an assignment for the bene t of creditors, is the subject of a voluntary or involuntary petition for bankruptcy, is adjudged insolvent or bankrupt, or a receiver or trustee is appointed for any portion of Lessee's assets or property; (g) if more than one (1) payment by Lessee to Lessor is returned by Lessee's bank for any reason within a twelve (12) month period; or (h) if Lessee or any guarantor is in default under or fails to comply with any other present or future agreement with or in favor of Lessor, Servicer of Lessor, or any direct or indirect subsidiary of Servicer of Lessor, Enterprise Holdings, Inc. or a subsidiary or af liate of Enterprise Holdings, Inc. For purposes of this Section 14, the term "guarantor" shall mean any present or future guarantor of all or any portion of the obligations of Lessee under this Agreement.
Upon the occurrence of any Event of Default, Lessor, without notice to Lessee, will have the right to exercise concurrently or separately (and without any election of remedies being deemed made), the following remedies: (a) Lessor may demand and receive immediate possession of any or all of the Vehicles from Lessee, without releasing Lessee from its obligations under this Agreement;
Source: Item 23 — RECEIPT (FDD pages 55–199)
What This Means (2025 FDD)
According to Canopy Lawn Care's 2025 Franchise Disclosure Document, several consequences can arise if the franchisee (Lessee) defaults on the Master Equity Lease Agreement. Events of default include failing to pay rent or other amounts due, failing to adhere to specific terms in Section 11 of the agreement, or failing to observe other terms, provisions, or covenants within the agreement, which remain unresolved for thirty days after written notice. Seizure or confiscation of any vehicle, or any act rendering a vehicle unsuitable for use also constitutes default. Additionally, if any guarantee in favor of the Lessor ceases to be in effect, is declared void, or is contested by a guarantor, it is considered an event of default.
Upon the occurrence of any default, the Lessor has the right to take several actions without notice to the Lessee. These include demanding immediate possession of the vehicles without releasing the Lessee from their obligations, enforcing the Lessee's obligations under the agreement, and recovering damages and expenses sustained by the Lessor due to the Lessee's default. The Lessor can also terminate the Lessee's rights under the agreement with written notice.
Furthermore, the Lessor may recover from the Lessee all amounts owed under Sections 3(b) and 3(c) of the agreement. If the Lessor does not recover possession of a vehicle, its estimated wholesale value is deemed to be $0.00 for calculation purposes. The Lessor can also exercise any other right or remedy available under the Uniform Commercial Code, any other applicable law, or in equity. These remedies provide the Lessor with broad powers to mitigate losses resulting from the Lessee's default, emphasizing the importance of adhering to the terms of the lease agreement.
For a prospective Canopy Lawn Care franchisee, this underscores the critical need to understand and meet all obligations under the Master Equity Lease Agreement to avoid potentially severe financial and operational repercussions. It is advisable to seek legal counsel to fully comprehend the implications of default and to ensure compliance with all terms and conditions.