Is the transferee required to pay an initial franchise fee to Bb.Q Chicken?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
- (f) The transferee shall execute, for a term ending on the expiration date of this Agreement and with such successor terms as may be provided by this Agreement, the standard form franchise agreement then being offered to new System franchisees and other ancillary agreements as we may require for the Franchised Business, which agreements shall supersede this Agreement and its ancillary documents in all respects and the terms of which agreements may differ from the terms of this Agreement, including, without limitation, the then-current System-wide Royalty Fee, Brand Development Fee or marketing expenditure requirement; provided, however, that the transferee shall not be required to pay any initial franchise fee;
Source: Item 23 — RECEIPTS (FDD pages 62–283)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, a transferee is generally not required to pay an initial franchise fee under specific conditions. The document states that the transferee must execute the standard form franchise agreement then being offered to new System franchisees and other ancillary agreements, which will supersede the original agreement. However, the critical exception is that "the transferee shall not be required to pay any initial franchise fee." This suggests that while the transferee must meet all other obligations and criteria, the initial franchise fee is waived.
However, in the event of a transfer, Bb.Q Chicken may require a transfer fee. If the transferee is someone outside of the Bb.Q Chicken system, the transfer fee is 50% of the then-current initial franchise fee. If the transferee is an existing franchisee, the transfer fee is 20% of the then-current initial franchise fee.
It is important to note that the transferee must still meet several other conditions to be approved. These include demonstrating that they meet Bb.Q Chicken's criteria for new franchisees, entering into a written agreement assuming all obligations of the original agreement, and, if the transferee is a corporation or partnership, having its shareholders or partners guarantee the performance of the agreement. The transferee may also need to complete any training programs in effect for franchisees and renovate the Franchised Business to meet current system standards.