Is a non-competition agreement required for a transfer of an Angry Chickz franchise?
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. |
Source: Item 17 — RENEWAL, TERMINATIONS, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 39–48)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, a non-competition agreement is required for a transfer of an Angry Chickz franchise. Specifically, the transferring franchisee must agree to a non-competition agreement that is acceptable to Angry Chickz and substantially similar to the terms outlined in the Franchise Agreement.
This requirement means that if you decide to sell your Angry Chickz franchise, you must ensure that you are willing to sign a non-compete agreement as part of the transfer process. This agreement likely restricts you from engaging in similar restaurant businesses within a specified area and timeframe, as detailed in the franchise agreement's non-competition clauses.
The need for a non-compete agreement during a transfer is a fairly standard practice in franchising. It protects Angry Chickz's brand and market share by preventing former franchisees from immediately opening a competing business nearby. Prospective franchisees should carefully review the specific terms of the non-compete agreement to understand its restrictions and ensure they are comfortable with them before proceeding with a franchise transfer.