What is the 'Notice of Election' in the context of an Angry Chickz franchise agreement renewal?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
3.3.3 If Franchisee fails timely to perform any of the acts, or timely to deliver any of the notices required pursuant to the provisions of Sections 3.3 or 3.4 such failure shall be deemed an election by Franchisee not to exercise its Successor Agreement Right and shall automatically cause Franchisee's Successor Agreement Right to lapse and expire.
3.4 Conditions Precedent to Entering into a Successor Franchise Agreement.
Franchisee's Successor Agreement Right is conditioned upon the fulfillment of each and all of the following conditions precedent:
3.4.1 At the time Franchisee delivers its Notice of Election to Company, Company is then-offering franchises in the state where the Location is located.
3.4.2 At the time Franchisee delivers its Notice of Election to Company, and at all times thereafter until the commencement of the Successor Term, Franchisee shall not have been, nor be, in default of its material obligations under this Agreement.
3.4.3 At Company's request, Franchisee shall, prior to the date of commencement of the Successor Term, have undertaken and completed at its expense, the remodeling, renovation, modernization, or refurbishing of the Premises and the Franchised Business, which may include installation of new or replacement FFE to comply with the Standards for new Restaurants.
3.4.4 Without limiting the generality of Section 3.4.1, Franchisee shall not have committed 3 or more material defaults of this Agreement during the prior 36 month period during the Term for which Company shall have delivered notices of default, whether or not such defaults were cured.
3.4.5 Franchisee, and Franchisee's employees, as applicable, shall comply with Company's then-current qualification, training and certification requirements at Franchisee's expense.
3.4.6 Concurrently with the execution of the Successor Franchise Agreement, Franchisee shall, and shall cause each of its Affiliates and owners / guarantors to, execute and deliver to Company a general release, on a form prescribed by Company of any and all known and unknown claims against Company and its Affiliates and their Owners, officers, directors, agents, and employees.
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to Angry Chickz's 2025 Franchise Disclosure Document, a 'Notice of Election' is a formal notification a franchisee must provide to the company to exercise their Successor Agreement Right, which is the option to renew their franchise agreement for a subsequent term. The FDD specifies that if a franchisee fails to deliver the required notices in a timely manner, it will be considered an election not to exercise their right to renew, causing the Successor Agreement Right to lapse and expire automatically.
For a prospective Angry Chickz franchisee, this means that strict adherence to the notification deadlines and procedures outlined in Sections 3.3 and 3.4 of the franchise agreement is crucial. Missing these deadlines can result in the loss of the right to renew the franchise, potentially jeopardizing the business's future at its current location. The franchisee must be proactive in understanding and meeting these obligations to ensure the continuity of their business operations.
Furthermore, the ability to exercise the Successor Agreement Right and deliver the Notice of Election is conditional. According to Section 3.4, at the time the franchisee delivers the Notice of Election, Angry Chickz must be offering franchises in the state where the location is situated, and the franchisee must not be in default of their material obligations under the agreement. The franchisee may also be required to remodel or renovate the premises to comply with the standards for new restaurants. The franchisee must also comply with Angry Chickz's then-current qualification, training, and certification requirements. These conditions highlight the importance of maintaining a good standing with Angry Chickz and continuously meeting the brand's standards to secure the renewal of the franchise agreement.
In addition to the above conditions, the franchisee must also provide a general release of any and all known and unknown claims against Angry Chickz and its affiliates. This release must be executed concurrently with the Successor Franchise Agreement. This requirement underscores the importance of a franchisee's relationship with Angry Chickz and the need to resolve any potential disputes before entering into a new franchise term.