How long does an Angry Chickz franchisee have to discharge a levy of execution or attachment on the license?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
er or assignment of an interest in Franchisee, or other change in ownership interests in Franchisee, and at any other time upon Company's request, said holders shall reexecute a written guaranty in a form prescribed by Company.
ARTICLE 14 DEFAULT AND TERMINATION
- 14.1 General. Company shall have the right to terminate this Agreement only for "cause". "Cause" is hereby defined as a default of this Agreement. Company shall exercise its right to terminate this Agreement in the following circumstances and manners.
- 14.2 Automatic Termination Without Notice. Subject to Applicable Laws of the jurisdiction in which the Franchised Business is operated to the contrary, Franchisee shall be deemed to be in default under this Agreement, and all rights granted herein shall at Company's election automatically terminate without notice to Franchisee if: (i) Franchisee shall be adjudicated bankrupt or judicially determined to be insolvent (subject to any contrary provisions of Applicable Law), shall admit to its inability to meet its financial obligations as they become due, or shall make a disposition for the benefit of its creditors; (ii) a judgment against Franchisee in the amount of more than $25,000 remains unsatisfied for a period of more than 30 days (unless an appeal bond has been filed); (iii) the Franchised Business, the Premises, or any of the Assets are seized, taken over or foreclosed by a government official in the exercise of its duties, or seized, taken over, or foreclosed by a creditor or lienholder provided that a final judgment against the Franchisee remains unsatisfied for 30 days (unless an appeal bond has been filed); (iv) a levy of execution or attachment has been made upon the license granted by this Agreement or upon any of the Assets, and it is not discharged within 5 days of such levy or attachment; (v) Franchisee permits any recordation of a notice of mechanics lien against the Franchised Business or
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, if a levy of execution or attachment has been made upon the license granted by the Franchise Agreement or upon any of the assets of the franchise, the franchisee has 5 days to discharge it. If the franchisee fails to discharge the levy or attachment within this 5-day period, Angry Chickz has the right to automatically terminate the Franchise Agreement without notice.
This clause is significant because it means that Angry Chickz can terminate the agreement immediately if a franchisee's business faces legal or financial issues leading to a levy or attachment, and the franchisee does not resolve it promptly. This protects Angry Chickz from potential damage to its brand and reputation that could arise from a struggling or legally encumbered franchise location.
Many franchise agreements contain similar clauses that allow the franchisor to terminate the agreement if the franchisee encounters financial or legal difficulties. The specific time frame allowed for resolving the issue can vary, but the underlying principle is to protect the franchisor's interests and maintain the integrity of the franchise system. A prospective Angry Chickz franchisee should be aware of this termination clause and ensure they have adequate financial and legal resources to address any potential levies or attachments promptly.