Is the Deka Lash franchisor obligated to cure a tenant's default?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
n the time limits provided therein; or
- c. Voluntary institution of any insolvency or bankruptcy proceedings as a debtor or insolvent on the part of Tenant or involuntary insolvency or bankruptcy proceedings brought against Tenant which are not dismissed within 60 days of the filing thereof;
- d. Discontinuation by the Tenant of operation of a Deka Lash operation in the Premises, whether voluntarily or involuntarily; or
- e. Nonrenewal by Tenant of the Franchise Agreement
- III. During the term of the Lease, Landlord agrees to give Franchisor written notice of all defaults of Tenant concurrently with the giving of such notice to Tenant. Landlord
- further agrees to give Franchisor a 10 day period to cure such default, or the period provided to the Tenant in the Lease, whichever period shall be longer.
- IV. Nothing in this Agreement shall obligate Franchisor to cure any such default, unless Franchisor agrees in writing in its sole discretion.
- V. The date upon which the assignment shall be effective (the "Effective Date"), is the date upon which Landlord and Tenant receive written notice from Franchisor that:
- a. Franchisor will cure the default of Tenant in the Lease in which Landlord has given notice to Franchisor pursuant to the provisions of Section 3 above, and that Franchisor will assume the Lease; or
- b. The events described in either subsections 2(b), 2(c), 2(d) or 2(e) above have occurred and that Franchisor will assume the Lease.
- VI. As of the Effective Date, Franchisor will assume all rights, duties, responsibilities and obligations of Tenant arising on or after the Effective Date pursuant to the terms and provisions of the Lease.
- VII. Landlord hereby consents to the terms and provisions of this Agreement, and to the assignment of the Lease to Franchisor. Landlord agrees that after the Effective Date, Franchisor may (i) enter into a sublease with any other franchisee of Franchisor without Landlord's further consent, or (ii) further assign the Lease to a franchisee of Franchisor who shall agree to assume Tenant's obligations under the Lease. Landlord further agrees that upon the occurrence of any such assignment, Franchisor shall have no further liability or obligation under the Lease.
- VIII. Tenant and Landlord agree not to allow any surrender or other assignment of the Lease without the prior written consent of Franchisor.
- IX.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
According to the 2024 Deka Lash Franchise Disclosure Document, the franchisor is not obligated to cure a tenant's default unless they agree to do so in writing at their sole discretion. However, if the tenant defaults on the lease, the landlord must provide written notice to Deka Lash concurrently with the notice given to the tenant. Deka Lash is given a period of 10 days, or the period provided to the tenant in the lease, whichever is longer, to cure the default.
If Deka Lash chooses to cure the default and assume the lease, the effective date is when the landlord and tenant receive written notice from Deka Lash. From that date forward, Deka Lash assumes all the tenant's rights, duties, responsibilities, and obligations under the lease. The landlord consents to the assignment of the lease to Deka Lash and agrees that Deka Lash may enter into a sublease with another franchisee or further assign the lease to another franchisee, after which Deka Lash will have no further liability under the lease.
The tenant and landlord are not allowed to surrender or assign the lease without Deka Lash's prior written consent. This arrangement allows Deka Lash to maintain control over the location and ensure continued operation of a Deka Lash franchise at that site, if desired. However, it's important to note that Deka Lash has no obligation to step in and cure a default unless they explicitly agree to do so in writing.