Besides the CEO's bankruptcy, are there any other bankruptcies required to be disclosed for Angry Chickz?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
Neither Angry Chickz Franchising LLC, nor any person in Item 2 of the disclosure document is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities Exchange Act of 1934, 15 U.S.C.A. 78a et seq., suspending or expelling these persons from membership in this association or exchange.
The franchise agreement provides for termination upon bankruptcy. This provision may not be enforceable under federal bankruptcy law (11 U.S.C.A. Sec. 101 et seq.).
The Franchise Agreement provides for termination if you are insolvent under any applicable state or federal law. This provision may not be enforceable under federal bankruptcy law (11 U.S.C.A. Section 101 et seq.).
Source: Item 4 — BANKRUPTCY (FDD page 10)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, Item 3 requires disclosure of certain legal actions. Specifically, Item 3 requires disclosure if Angry Chickz Franchising LLC, or any person listed in Item 2 of the disclosure document, is subject to any effective order from a national securities association or exchange that suspends or expels them from membership.
In California and Maryland, there are additional disclosures related to bankruptcy within Item 17. In California, the addendum states that the franchise agreement provides for termination upon bankruptcy, but this provision may not be enforceable under federal bankruptcy law. Similarly, the Maryland addendum notes that the Franchise Agreement allows for termination if the franchisee is insolvent under state or federal law, but this provision might also be unenforceable under federal bankruptcy law.
Therefore, besides the CEO's bankruptcy, Angry Chickz must disclose any relevant orders from securities associations or exchanges. Additionally, the FDD acknowledges that standard franchise agreement clauses regarding termination upon bankruptcy may not be fully enforceable due to federal law.