What is the meaning of 'Secured Party' in the context of the Bath Tune Up franchise agreement?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
tely upon any acceleration of the Obligations pursuant to Section 6.2 of the Security Agreement or upon the purchase by Obligor of another BATH TUNE-UP® franchise from any source. | | payme | or may prepay this Note in whole or in part from time to time without penalty, but any principal and must be accompanied by all interest then accrued, if any. Any partial payments will be applied to rge the principal sum payments in the inverse order in which any payments would otherwise become dditionally, Obligor may terminate the Security Agreement by paying in full all the Obligations due ured Party under this Note and as otherwise due to Secured Party under the Security Agreement, in | | discha | | | due. A | | Upon the occurrence of an Event of Default, Secured Party shall have all of the rights and remedies set forth in Section 6.2 of the Security Agreement.
cash.
Time is of the essence of this Note. To the fullest extent permitted by applicable law, Obligor, for itself and its legal representatives, successors and assigns, expressly waives presentment, demand, protest, notice of dishonor, notice of non-payment, notice of maturity, notice of protest, presentment for the purpose of accelerating maturity, diligence in collection, and the benefit of any exemption or insolvency laws.
Wherever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Note shall be prohibited or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or remaining provisions of this Note.
Source: Item 23 — RECEIPTS (FDD pages 52–222)
What This Means (2025 FDD)
According to the 2025 Bath Tune Up Franchise Disclosure Document, the 'Secured Party' is referenced in connection with a Secured Promissory Note and a General Security Agreement. These documents are listed as Exhibits J and K, respectively, and are signed by the franchisee, who is referred to as the 'Obligor' or 'Pledgor' in these contexts. The franchisor, is the 'Secured Party'.
In the event of a default by the franchisee ('Obligor'), the 'Secured Party' (Bath Tune Up) has specific rights and remedies as detailed in Section 6.2 of the Security Agreement. This indicates that the franchisee has provided some form of collateral to Bath Tune Up to secure their obligations under the promissory note.
The FDD specifies that no delay or failure on the part of the Secured Party in exercising any right or remedy acts as a waiver, nor does it prevent the Secured Party from pursuing other rights or remedies. The Secured Party can enforce its rights against any collateral without having to enforce rights against the Obligor, any guarantor, or any other property or indebtedness. This means Bath Tune Up has considerable latitude in how it pursues remedies in case of franchisee default.
Furthermore, Bath Tune Up, as the Secured Party, can release, surrender, substitute, or exchange any collateral securing the note or release any party liable for the debt without affecting the franchisee's liability. This clause provides Bath Tune Up with flexibility in managing the collateral and associated liabilities, while the franchisee remains primarily responsible for the debt.