What is the cure period for a monetary default under the Hck Hot Chicken Development Agreement?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.1.1 Subject to Applicable Law to the contrary, this Development Agreement may be terminated by Franchisor in the event of any Default by Area Developer of this Development Agreement, unless such Default is cured by Area Developer within five days following written notice of the Default (in the case of a failure to pay money), or ten days following written notice of the Default (in the case of any other Default); provided that in the case of a Default by Area Developer (or its Affiliate) under any Franchise Agreement or other written agreement, the notice and cure provisions of the Franchise Agreement or other agreement shall control, and provided, further, however, that any Default described in Sections 9.1.2(a), (b) or (e) below shall be deemed incurable.
Source: Item 23 — RECEIPTS (FDD pages 55–245)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, if an Area Developer fails to pay money owed under the Development Agreement, they have five days to cure the default after receiving written notice. However, if the default pertains to a Franchise Agreement or other written agreement, the notice and cure provisions outlined in that specific agreement will take precedence over the Development Agreement's terms. Certain defaults are deemed incurable, meaning they cannot be rectified, and the agreement can be terminated immediately.
This means that if a Hck Hot Chicken Area Developer is late on a payment, they will receive a formal written notice and then have five days to make the payment to avoid termination of the Development Agreement. It is important to note that this cure period applies specifically to monetary defaults under the Development Agreement itself. If the monetary default occurs under a separate Franchise Agreement, the cure period defined in that Franchise Agreement would apply instead.
The existence of incurable defaults is a significant point for prospective Area Developers. These defaults, once triggered, lead to immediate termination of the Development Agreement, regardless of any attempts to rectify the situation. The FDD excerpt does not specify what those incurable defaults are, but it does reference sections 9.1.2(a), (b), or (e) as examples of defaults that would be deemed incurable.
Prospective Hck Hot Chicken Area Developers should carefully review the Development Agreement and any related Franchise Agreements to fully understand the circumstances under which a default may occur, the applicable cure periods for different types of defaults, and, most importantly, the specific defaults that are considered incurable. Understanding these provisions is crucial for managing risk and ensuring compliance with the terms of the agreements.