When does the Churchs Chicken sublessee begin paying base rent, and how is it paid?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
essor's duties and obligations under said Master Lease applicable to the Premises. Sublessee covenants and agrees to refrain from violating or breaching any of the terms, covenants or conditions of the Master Lease or this Sublease. Except for the surrender, turn over and holdover rents provisions, to the extent of any conflict between the terms of this Sublease and the Master Lease, the terms of this Sublease shall control. If the Master Lease is terminated for any reason whatsoever, this Sublease shall automatically terminate at such time.
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- Other Agreements. Sublessee agrees to comply with all of the terms and conditions of any franchise agreement, development agreement, asset purchase agreement, promissory note, this Sublease and any guaranty, or other agreement entered into by Sublessee (collectively, the "Agreements"), any of its Affiliates (for the purposes of this Sublease, "Affiliate" shall mean any individual, group, association, limited or general partnership, corporation or other business entity which directly or indirectly controls the Sublessee, is controlled by, or is under common control with the Sublessee, or which directly or indirectly owns, controls, or holds power to vote ten percent (10%) or more of the outstanding voting securities of Sublessee, or which has in common one or more partners, officers, directors, trustees, branch managers, or other persons occupying similar status or performing similar functions), predecessors, or successors and Sublessor or any of its Affiliates, predecessors, or successors. Any default by Sublessee of any of the Agreements listed in this Section 4 above shall, at the option of Sublessor be and constitute a default under this Sublease, such that the Agreements listed in this Section 4 above and this Sublease are cross-defaulted. To the extent that any insurance requirements, record or bookkeeping requirements, or any other requirements in the above-described franchise, development, or other agreements require more from the Sublessee than the respective provisions of this Sublease, than the provisions of said franchise, development, and other agreements shall supersede and control.
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- Rent. Beginning on the Commencement Date, Sublessee shall pay to Sublessor fixed rent ("Base Rent") for each year of the Lease Term, to be due and payable without prior demand, offset or deduction whatsoever, in monthly installments in advance on the first day of each month during the Lease Term in accordance with the Rider to Sublease Agreement, attached hereto and made a part hereof. In addition, Sublessee shall be responsible for any state sales tax and shall pay directly to the respective governmental authority. If this Sublease shall commence on any day other than the first day of a calendar month, the monthly installment for the first and last month of the Lease Term shall be prorated. Beginning on the Commencement Date, Sublessee shall, in addition to Base Rent (as defined below), pay to Sublessor on or before the due date therefor, all sums whether or not required to be paid by Sublessor under the Master Lease, to the extent related to the Premises, including without limitation Sublessor's share of Common Area Expenses, if any, (as defined in the Master Lease), charges, costs, expenses, and sums, whether such sum is due the Master Landlord, a third party, or to reimburse the Master Landlord for taxes, property taxes, operating expenses, charges for water, sewer taxes, assessments, common area maintenance charges or other charges, costs, expenses, and sums incurred in connection with the Premises (collectively, "Additional Rent"), (Base Rent and Additional Rent (defined below), shall be referred to collectively as "Rent"). Any separately invoiced Rent shall be paid to Sublessor no later than: five (5) days prior to the date upon which Sublessor's payment of such Additional Rent is due, or ten (10) days after Sublessee shall have received a notice referencing the Additional Rent due (the notice shall be accompanied by a copy of the original invoice). If the Commencement Date of this Sublease is other than the first day of a month, Sublessee shall be required to pay a pro rata portion of the monthly installment of the Additional Rent for any partial month.
Source: Item 23 — RECEIPT (FDD pages 68–406)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the sublessee is required to pay base rent beginning on the Commencement Date. The base rent is a fixed rent for each year of the lease term. It is due and payable without any prior demand, offset, or deduction. The payments are made in monthly installments in advance on the first day of each month throughout the lease term, as specified in the Rider to Sublease Agreement. If the sublease commences on a day other than the first day of a calendar month, the monthly installment for the first and last month of the lease term will be prorated.
In addition to the base rent, the sublessee is also responsible for paying any state sales tax directly to the respective governmental authority. The sublessee must also pay additional rent to the sublessor, which includes the sublessor's share of common area expenses and other costs related to the premises, such as property taxes, operating expenses, and charges for water and sewer. These additional rent payments are due either five days before the sublessor's payment is due or ten days after the sublessee receives a notice with a copy of the original invoice.
The Rider to Sublease Agreement supersedes any inconsistencies between the terms of the Sublease and the Rider. The base rent for the initial term is described in a table within the Rider and is paid according to the terms of the Sublease. During the initial term and any extension period, the base rent increases annually by 1.5% over the prior year's amount. The sublessor can also require the sublessee to make tax payments in advance with the monthly rent payment into an escrow account held by the sublessor, with the amount determined by a good faith estimate of the sublessor based on the tax history of the premises.