Under what conditions will Angry Chickz restaurants assigned to Affiliates of the developer count towards fulfilling the Development Obligation?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
- 2.1.1 Within each Development Period specified in Exhibit B, Developer shall construct, equip, open and thereafter continue to operate within the Development Area, not less than the cumulative number of Dine-In Restaurants required by the Development Obligation for that Development Period. Restaurants developed hereunder which are open and operating and which have been assigned to Affiliates of Developer in accordance with Section 7.2.2 with Company's consent, shall count in determining whether Developer has satisfied the Development Obligation for so long as the applicable Affiliate continues to satisfy the conditions set forth in Section 7.2.2.
Source: Item 23 — RECEIPTS (FDD pages 54–260)
What This Means (2025 FDD)
According to Angry Chickz's 2025 Franchise Disclosure Document, restaurants developed under the Area Development Agreement that are open and operating and have been assigned to Affiliates of the developer will count towards fulfilling the Development Obligation under specific conditions. These conditions include obtaining Angry Chickz's consent for the assignment, and the Affiliate must continue to satisfy the conditions outlined in Section 7.2.2 of the agreement.
This means that a developer can assign restaurants to their Affiliates, and those restaurants will still count towards meeting their development quota, provided Angry Chickz approves the assignment. However, the Affiliate taking over the restaurant must also meet certain ongoing requirements as detailed in Section 7.2.2 of the Area Development Agreement.
This arrangement provides flexibility for the developer in managing their development obligations while ensuring that the restaurants are operated according to Angry Chickz's standards. It is important for prospective developers to carefully review Section 7.2.2 to understand the specific conditions that their Affiliates must meet to maintain compliance and ensure that the assigned restaurants continue to count towards their Development Obligation.