If Chop5 Salad Kitchen assigns the lease after curing a default, what approval is needed?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
If Tenant defaults under the Lease, Franchisor has the right (but not the duty) to cure such default within 15 days following the expiration of any applicable cure period. In such event, Franchisor may immediately commence occupancy of the Premises as the tenant under the Lease without obtaining Landlord's or Tenant's consent. Franchisor may thereafter assign the Lease to another CHOP5 Salad Kitchen franchisee or to an entity owned and/or controlled by Franchisor. If it does, Franchisor must first obtain Landlord's written approval of the assignee. Landlord, however, must neither unreasonably withhold nor delay its approval thereof. Landlord will acknowledge any such assignment in writing.
Source: Item 23 — RECEIPT (FDD pages 50–178)
What This Means (2024 FDD)
According to the 2024 Chop5 Salad Kitchen Franchise Disclosure Document, if the tenant defaults under the lease, Chop5 Salad Kitchen has the right to cure the default within 15 days after the cure period expires. If Chop5 Salad Kitchen cures the default, it can commence occupancy of the premises without the landlord's or tenant's consent.
After taking possession, Chop5 Salad Kitchen can assign the lease to another Chop5 Salad Kitchen franchisee or an entity they own or control. However, to do so, Chop5 Salad Kitchen must first obtain the landlord's written approval of the assignee. The landlord cannot unreasonably withhold or delay this approval and must acknowledge the assignment in writing.
This clause protects Chop5 Salad Kitchen's interest in maintaining a location for a franchise restaurant, even if the original franchisee fails. It also ensures that the landlord is involved in the assignment process, with the right to approve the new tenant, but with the stipulation that approval cannot be unreasonably withheld.