Must an Angry Chickz franchisee comply with the right of first refusal before transferring?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| assign to us (at our option) all internet web pages, email address, social media listings, domain names and other registrations containing the marks. If applicable, pay liquidated damages. See also "r" below. | ||
| j. Assignment of | § 13.1 | No restriction on our right to assign. |
| contract by | ||
| Franchisor | ||
| k. "Transfer" by | § 13.2.1 | Includes transfer of the agreement or change in ownership of a franchisee which is an entity. |
| franchisee – defined | ||
| Franchisor approval of transfer | § 13.2 | Transfers require our express written consent You must: (i) provide a detailed description of the price and material terms of the transfer/Assignment; (ii) provide us a list of your Owners and others with an interest in the franchise agreement; (iii) have complied with the right of first refusal and we must not have exercised our right of first refusal; (iv) not be in default; (v) be current to your obligations to third parties; (vi) have signed a release and your Owners must have signed a release; (vii) not have any suit or action pending or threatened with respect to your Angry Chickz Restaurant; (viii) pay the Transfer Fee; and (ix) agree to a non-competition agreement accepted to us which agreement is substantially similar to the Franchise Agreement terms. |
| m. Conditions for franchisor approval of transfer | §§ 13.2 – 13.4 | New franchisee must: (i) qualify; |
Source: Item 17 — RENEWAL, TERMINATIONS, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 39–48)
What This Means (2025 FDD)
According to Angry Chickz's 2025 Franchise Disclosure Document, a franchisee must comply with the right of first refusal before transferring their franchise. Specifically, the franchisee must ensure that Angry Chickz has not exercised its right of first refusal as part of the transfer process.
This means that if a franchisee wants to sell their Angry Chickz restaurant, they must first offer the business to Angry Chickz on the same terms as any third-party offer. Angry Chickz has the option to match the offer and purchase the franchise themselves. Only if Angry Chickz declines to exercise this right can the franchisee proceed with selling to the third party.
This right of first refusal is a fairly standard provision in franchise agreements. It allows Angry Chickz to maintain control over who becomes a franchisee and ensures that the brand's standards and reputation are upheld. For a prospective franchisee, this means that selling the business may take longer and that Angry Chickz ultimately has the final say on who can buy the franchise.
In addition to complying with the right of first refusal, the Angry Chickz franchisee must also fulfill other conditions to get franchisor approval. These include providing a detailed description of the transfer terms, ensuring they are not in default, being current with obligations to third parties, signing a release, and paying a transfer fee.