What is the definition of 'Collateral' in the Browns Chicken Security Agreement?

According to the 2025 Browns Chicken Franchise Disclosure Document, the Security Agreement defines 'Collateral' as the property located at or relating to the Browns Chicken & Pasta store at the premises. This includes 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. It also encompasses all additions and accessions to, and all proceeds and products of the aforementioned items.

In simpler terms, the collateral represents virtually all the tangible and intangible assets associated with the Browns Chicken franchise location. This broad definition gives Browns Chicken a comprehensive security interest in the franchisee's business assets. This means that Browns Chicken has a legal claim on these assets, which can be used to recover any debts or obligations the franchisee owes to Browns Chicken, as outlined in the Franchise Agreement.

For a prospective Browns Chicken franchisee, this definition is crucial because it outlines the extent of the assets that are at risk in the event of a default. Understanding the scope of the collateral helps the franchisee appreciate the importance of fulfilling their financial and contractual obligations to Browns Chicken. It is also important to note that the franchisee cannot remove the collateral from the premises or allow it to become an accession to other goods without Browns Chicken's consent.