How long does a Benihana franchisee have to satisfy a final judgment against them before it becomes an act of default?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 13.2.5 A final judgment against Franchisee remains unsatisfied of record for thirty (30) days or longer (unless a supersedeas or other appeal bond is filed), execution is levied against Franchisee's business or property at the Location, or a suit to foreclose any lien or mortgage against the Restaurant premises or any furniture, fixtures, or equipment at the Restaurant is filed against Franchisee and not dismissed within thirty (30) days.
The cure period for an act of default under this provision is five (5) days after notice by BNC following expiration of any other period set forth in the provision.
Source: Item 23 — Receipts (FDD pages 74–576)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, a franchisee has thirty days to satisfy a final judgment against them. If the judgment remains unsatisfied for this period, it constitutes an act of default under the franchise agreement.
However, Benihana provides a cure period of five days after they notify the franchisee. This means that even after the initial thirty-day period, the franchisee has an additional five days after receiving notice from Benihana to resolve the judgment.
This clause also includes an exception: the 30-day period does not apply if a supersedeas or other appeal bond is filed. Additionally, if a suit to foreclose any lien or mortgage against the Restaurant premises or any furniture, fixtures, or equipment at the Restaurant is filed against Franchisee and not dismissed within thirty (30) days, it constitutes an act of default.