For the Browns Chicken Security Agreement, what is included in the description of collateral?

According to the 2025 Browns Chicken Franchise Disclosure Document, the Security Agreement specifies the collateral as property located at or relating to the Browns Chicken & Pasta store at the premises. This includes all equipment, furniture, fixtures, inventory, personal property, and supplies. It also encompasses general intangibles, accounts receivable, accounts, contract rights, chattel paper, and instruments, whether currently owned or acquired in the future by the franchisee (Debtor). The collateral also includes all additions and accessions to, and all proceeds and products of the aforementioned items.

In simpler terms, Browns Chicken requires a security interest in essentially all assets related to the operation of the franchise. This gives Browns Chicken a legal claim on these assets if the franchisee fails to meet their obligations under the Franchise Agreement. This is a common practice in franchising, as it protects the franchisor's investment and brand standards.

For a prospective Browns Chicken franchisee, this means that a significant portion of their business assets will be encumbered by this security interest. It is important to understand the implications of this, particularly in the event of financial difficulties or a potential sale of the franchise. The franchisee should seek legal counsel to fully understand the scope of the Security Agreement and its potential impact on their business.