What document describes the specific property of the Big Apple Bagels franchisee that serves as collateral?
Big_Apple_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
| This Security Agreement dated is by and between | ||
|---|---|---|
| BAB Systems, Inc., an Illinois corporation, of 500 Lake Cook Road, Suite 475, Deerfield, Illinois | ||
| 60015 | ("Secured Party") and | |
| , whose principal place of business is ("Debtor"). RECITALS | ||
| A. | Debtor is a franchisee under a Franchise Agreement dated ("Franchise Agreement") with Secured Party as Franchisor, pursuant to which Franchise Agreement Debtor has ongoing monetary and non-monetary obligations to Secured Party. | |
| B. | Debtor has locations at which Debtor operates businesses known as "Big Apple Bagels" ("BAGELS Stores"), pursuant to the Franchise Agreement; the addresses of the locations are listed on Schedule "A" attached hereto and incorporated herein by reference. | |
| C. | Debtor is giving Secured Party a security interest in the collateral described in this | |
| Agreement. | NOW THEREFORE, in consideration of the several and mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: | |
| 1. | The Recitals set forth above shall be incorporated into this part of the Agreement as though they were fully set forth herein. | |
| 2. | Description of Collateral: the following property located at or relating to the BAGELS Stores noted on Schedule A: all equipment, furniture, fixtures, inventory, personal property, supplies, general intangibles, accounts receivable, accounts, contract rights, chattel paper and instruments, now owned or hereafter acquired by the Debtor, and all additions and accessions to, and all proceeds and products of the foregoing ("Collateral"). | |
| 3. | Debtor hereby grants to Secured Party a security interest in the Collateral described in |
Source: Item 22 — CONTRACTS (FDD pages 86–87)
What This Means (2025 FDD)
According to Big Apple Bagels' 2025 Franchise Disclosure Document, the Security Agreement outlines the specific property that serves as collateral. This agreement, between BAB Systems, Inc. as the Secured Party and the franchisee as the Debtor, details the security interest granted to the Secured Party. The agreement is tied to the Franchise Agreement, acknowledging the franchisee's ongoing monetary and non-monetary obligations to Big Apple Bagels. Addresses of the Big Apple Bagels locations are listed on Schedule A, which is attached to and incorporated into the Security Agreement.
The Security Agreement specifies that the collateral includes all property located at or relating to the Big Apple Bagels stores listed on Schedule A. This encompasses a broad range of assets, including equipment, furniture, fixtures, inventory, personal property, and supplies. It also extends to intangible assets such as general intangibles, accounts receivable, accounts, contract rights, chattel paper, and instruments. The collateral includes anything the franchisee owns now or acquires later, as well as any additions, accessions, proceeds, and products derived from these assets.
For a prospective Big Apple Bagels franchisee, this means that upon signing the Security Agreement, a wide array of their business assets will be subject to a security interest in favor of BAB Systems, Inc. This security interest allows Big Apple Bagels to claim these assets if the franchisee fails to meet their obligations under the Franchise Agreement. It is important for franchisees to carefully review Schedule A and understand the full scope of the collateral described in the Security Agreement, as it directly impacts their rights and obligations.