What does a Big Apple Bagels debtor authorize the Secured Party to file?

According to the 2025 Big Apple Bagels Franchise Disclosure Document, a debtor authorizes the Secured Party to file Uniform Commercial Code (UCC) Financing Statements. This authorization enables the Secured Party to perfect their security interest by filing under the Uniform Commercial Code in the state where the Big Apple Bagels stores are located. The debtor also waives any requirement or custom that would otherwise necessitate the debtor's execution of these UCC Financing Statements.

In simpler terms, as a Big Apple Bagels franchisee (the debtor), you are giving BAB Systems, Inc. (the Secured Party) the right to file documents that legally establish their claim on your business assets. This is a standard practice in franchising where the franchisor provides support and resources, and in return, secures their investment with a claim on the franchisee's assets.

The UCC Financing Statements serve as public notice that BAB Systems, Inc. has a security interest in the collateral, which includes equipment, furniture, fixtures, inventory, and other assets related to the Big Apple Bagels store. This means that if the franchisee defaults on their obligations under the Franchise Agreement, BAB Systems, Inc. has the legal right to seize and liquidate these assets to recover their losses. By waiving the requirement for the franchisee's signature on these statements, the process is streamlined, allowing Big Apple Bagels to quickly establish and protect their security interest.