Under what circumstances can the Hck Hot Chicken franchisor cure a franchisee's default?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to all other remedies herein granted if Franchisee shall default in the performance of any of its obligations or breach any term or condition of this Agreement or any related agreement, Franchisor may, at its election, immediately or at any time thereafter, without waiving any claim for default or breach hereunder and without notice to Franchisee, cure such default or breach for the account and on behalf of Franchisee, and the cost to Franchisor thereof shall be due and payable on demand and shall be deemed to be additional compensation due to Franchisor hereunder and shall be added to the amount of compensation next accruing hereunder, at the election of Franchisor.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, the franchisor has the right to cure a franchisee's default under certain conditions. Specifically, if a franchisee defaults on any obligation or breaches any term of the franchise agreement or related agreements, Hck Hot Chicken can choose to cure the default on behalf of the franchisee. This can be done immediately or at any time after the default, without waiving any claim for the default.
The cost incurred by Hck Hot Chicken to cure the default will be charged to the franchisee. This cost is due and payable upon demand and is considered additional compensation owed to Hck Hot Chicken. The franchisor can add this amount to the compensation next accruing under the agreement, at their discretion.
This provision allows Hck Hot Chicken to step in and rectify a franchisee's failure to meet their obligations, which could be beneficial in maintaining brand standards and operational consistency. However, the franchisee is ultimately responsible for the costs associated with the cure, which could create a financial burden. It is important to note that this right does not obligate Hck Hot Chicken to cure any default, and they can still pursue other remedies for the breach.