Under what conditions will Bb.Q Chicken approve a franchisee's transfer?
Bb_Q_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
e state and federal law |
| Provision | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| k. | "Transfer" by franchisee – defined | Section 14.2.1 | Includes sale, assignment, conveyance, pledge, mortgage or other encumbrance of any interest in the Franchise Agreement, the Restaurant or Food Truck or you (if you are not a natural person) |
| 1. | Franchisor approval of transfer by franchisee | Section 14.2.2 | You must obtain our consent before transferring any interest. We will not unreasonably withhold our consent |
| m. | Conditions for franchisor approval of transfer | Section 14.2.2 | Conditions include: You must pay all amounts due us, not otherwise be in default, sign a general release, and pay a transfer fee. Transferee must meet our criteria, complete training to our satisfaction and sign current Franchise Agreement |
| n. | Franchisor's right of first refusal to acquire franchisee's business | Section 14.4 | Within 30 days after notice, we have the option to purchase the transferred interest on the same terms and conditions |
| 0. | Franchisor's option to purchase franchisee's business | Section 18.11 | Upon termination or expiration of the Franchise Agreement, we have the right to purchase certain assets of the Franchised Business |
| p. | Death or disability of franchisee | Section 14.5 | The Franchise Agreement will terminate upon your death or permanent disability, and the Franchised Business must be transferred within six months to a replacement franchisee that we approve. |
| q. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 49–55)
What This Means (2025 FDD)
According to Bb.Q Chicken's 2025 Franchise Disclosure Document, a franchisee needs to meet certain conditions to get approval for a transfer. Bb.Q Chicken defines 'transfer' broadly, including sale, assignment, conveyance, pledge, mortgage, or other encumbrance of any interest in the Franchise Agreement, the Restaurant or Food Truck, or the franchisee itself if it's not a natural person. Bb.Q Chicken's consent is required before any transfer of interest. However, Bb.Q Chicken states that it will not unreasonably withhold its consent.
For a transfer to be approved, the franchisee must meet several conditions. First, all amounts due to Bb.Q Chicken must be paid. The franchisee must not be in default of the agreement. A general release must be signed, and a transfer fee must be paid. Additionally, the person or entity to whom the franchise is being transferred (the transferee) must meet Bb.Q Chicken's criteria for new franchisees. The transferee must also complete training to Bb.Q Chicken's satisfaction and sign the current Franchise Agreement.
For multi-unit operators, the conditions for transfer are slightly different. The multi-unit operator must not be in default. At least 25% of all outlets required to be developed must be open or under construction. All debts must be paid. The buyer must meet Bb.Q Chicken's current criteria for new multi-unit operators. A general release must be executed (where legal), a transfer fee must be paid, and the buyer must personally guarantee all obligations.
Bb.Q Chicken also retains the right of first refusal to acquire the franchisee's business. This means that before a franchisee can transfer their interest to a third party, Bb.Q Chicken has the option to purchase the transferred interest on the same terms and conditions offered by the third party. This right must be exercised within 30 days after notice of the proposed transfer.