Under what circumstances does Golden Krust Caribbean Restaurant have the right to take possession of the premises?
Golden_Krust_Caribbean_Restaurant Franchise · 2024 FDDAnswer from 2024 FDD Document
Landlord hereby grants certain rights to Franchisor under the Lease to protect the Franchisor's interest under the Franchise Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth the parties agree as follows:
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- Possession. Upon a default by Tenant under the Lease or under the Franchise Agreement, in the event of a default by Tenant under any instrument securing the Franchise Agreement, or upon expiration of the Franchise Agreement, Franchisor has the right to take possession of the Premises.
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- Notices of Default. Landlord shall mail, upon transmission or within three (3) days of receipt, by first class mail, postage prepaid, to Franchisor at the address below, copies of all written notices of default sent to or received from Tenant:
Golden Krust Franchising, Inc., 399 Knollwood Road, Suite 117 White Plains, New York 10603 Attn.: Lorraine Hawthorne-Morrison
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- Right to Cure. If Tenant is in default under the Lease, Franchisor may (but shall be under no obligation to) within the cure period set forth in the Lease, cure such default and take immediate occupancy of the Premises without Landlord consent, except Franchisor shall cure any default before occupancy. Franchisor may at any time after taking occupancy, re-let the Premises to another franchisee with Landlord's written approval of the new tenant, which consent shall not be unreasonably withheld or delayed.
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- Right to Assign. Tenant may assign its interest under the Lease and all rights and obligations thereunder at any time to Franchisor without Landlord's consent provided all defaults are cured. Franchisor shall be permitted to assign the Lease and all rights and obligations thereunder to another franchisee upon Landlord's written approval of the new tenant which approval shall not be unreasonably withheld or delayed.
Source: Item 23 — RECEIPT (FDD pages 35–153)
What This Means (2024 FDD)
According to the 2024 Golden Krust Caribbean Restaurant Franchise Disclosure Document, Golden Krust Franchising, Inc. has specific rights regarding the franchise location premises. The Landlord grants these rights to Golden Krust Caribbean Restaurant to protect its interests under the Franchise Agreement.
Golden Krust Caribbean Restaurant has the right to take possession of the premises under the following conditions: if the franchisee (Tenant) defaults under the Lease, if the franchisee defaults under the Franchise Agreement, in the event of a default by Tenant under any instrument securing the Franchise Agreement, or upon the expiration of the Franchise Agreement. This provision ensures that Golden Krust Caribbean Restaurant can maintain control over the location and continue operations, if necessary, to protect the brand and its interests.
Additionally, the Landlord is obligated to send Golden Krust Caribbean Restaurant copies of all written notices of default sent to or received from the franchisee. This allows Golden Krust Caribbean Restaurant to stay informed of any issues that could lead to a default and potentially take action to remedy the situation. Golden Krust Caribbean Restaurant also has the option, but not the obligation, to cure any default by the franchisee within the cure period specified in the Lease and take immediate occupancy of the premises without the Landlord's consent, provided they cure any default before occupancy.
Golden Krust Caribbean Restaurant can also assign the Lease to another franchisee with the Landlord's written approval, which cannot be unreasonably withheld or delayed. This provides flexibility for Golden Krust Caribbean Restaurant to ensure continued operation of the franchise at that location. However, Golden Krust Caribbean Restaurant assumes no liability or obligation under the Lease unless it explicitly assumes the Lease in writing.