After Itan commences occupancy due to tenant default, can Itan assign the lease to another Itan franchisee?
Itan Franchise · 2025 FDDAnswer from 2025 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 iTAN 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. No assignment permitted under this Section is subject to any assignment or similar fee or will cause any rental acceleration.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, if a tenant defaults on their lease, Itan has the right to cure the default within 15 days after the cure period expires. If Itan chooses to cure the default, it can immediately take occupancy of the premises without needing consent from the landlord or the tenant. Following this, Itan has the option to assign the lease to another Itan franchisee.
However, Itan must first obtain written approval from the landlord for the assignment. The landlord is obligated to not unreasonably withhold or delay this approval. Once the assignment is approved, the landlord will acknowledge it in writing.
Importantly, the FDD states that no assignment fee will be charged, nor will the rent be accelerated as a result of this type of assignment. This provides Itan with flexibility in managing lease situations and ensuring continuity of the franchise operation.