What constitutes a new offer requiring Bb.Q Chicken's right of first refusal?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
14.4.1 If you wish to transfer all or part of your interest in the Franchised Business or this Agreement or if you wish to transfer any ownership interest in you, pursuant to any bona fide offer received from a third party to purchase such interest, then such proposed seller shall promptly notify us in writing of each such offer, and shall provide such information and documentation relating to the offer as we may require. We shall have the right and option, exercisable within thirty (30) days after receipt of such written notification and copies of all documentation required by us describing such offer, to send written notice to the seller that we intend to purchase the seller's interest on the same terms and conditions offered by the third party. In the event that we elect to purchase the seller's interest, closing on such purchase must occur within the latest of (i) sixty (60) days from the date of notice to the seller of the election to purchase by us, (ii) sixty (60) days from the date we receive or obtain all necessary documentation, permits and approvals, or (iii) such other date as the parties agree upon in writing. Any material change in the terms of any offer prior to closing shall constitute a new offer subject to the same right of first refusal by us as in the case of an initial offer. Our failure or refusal to exercise the option afforded by this Section 14.4 shall not constitute a waiver of any other provision of this Agreement, including all of the requirements of Article 14, with respect to a proposed transfer.
Source: Item 23 — RECEIPTS (FDD pages 62–283)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, any material change to the terms of an offer to purchase a franchisee's interest prior to closing is considered a new offer. This triggers Bb.Q Chicken's right of first refusal, allowing them to reassess the offer and decide whether to purchase the franchisee's interest on the revised terms.
This provision is important for prospective Bb.Q Chicken franchisees because it ensures that Bb.Q Chicken has the opportunity to maintain control over who joins their franchise system. If a franchisee receives an offer to sell their business, Bb.Q Chicken has the right to match that offer and purchase the business themselves. This prevents the franchisee from transferring the business to someone Bb.Q Chicken does not approve of.
The stipulation that a material change restarts the process is significant. It means that even if Bb.Q Chicken initially waives its right of first refusal, any substantial alteration to the deal—such as a change in price, payment terms, or included assets—gives Bb.Q Chicken another chance to step in. This protects Bb.Q Chicken from being bound by their initial decision if the deal evolves significantly.
For a franchisee looking to sell, this means transparency and adherence to the agreement's stipulations are crucial. Any modifications to the offer must be promptly communicated to Bb.Q Chicken to avoid potential legal issues or delays in the sale process. Franchisees should seek legal counsel to ensure they fully understand their obligations and the implications of this clause when considering a sale.