What constitutes a 'transfer' of a Browns Chicken franchise?

According to Browns Chicken's 2025 Franchise Disclosure Document, a 'transfer' of the franchise encompasses any type of transfer, including a change in ownership. This definition is broad and suggests that any alteration in the control or equity of the franchise business is considered a transfer under the terms of the Franchise Agreement.

For a prospective Browns Chicken franchisee, this means that selling the business, bringing in a partner, or even changes in the ownership structure of the franchisee entity (if it's a corporation or LLC) could be classified as a transfer. Browns Chicken maintains significant control over who operates its franchises and can regulate these changes.

Browns Chicken requires approval for any transfer. Full compliance with all existing agreements is necessary, and Browns Chicken must approve the proposed new franchisee. Additionally, a transfer fee must be paid, and the new franchisee is required to execute all agreements. Browns Chicken also retains the right of first refusal to acquire the franchisee's business, meaning that the franchisee must offer Browns Chicken the opportunity to purchase the business on the same terms as a proposed sale before proceeding with a transfer to a third party. This right of first refusal requires the franchisee to give Browns Chicken 30 days’ notice of the proposed sale terms. If the sale to the proposed transferee is not completed within 6 months from the date of the first notice, Browns Chicken's right of first refusal is renewed.

In the event of the death or disability of a Browns Chicken franchisee, the franchise can still be transferred, but it remains subject to the same conditions as other transfers and must be accomplished within 6 months. This ensures that Browns Chicken maintains control over the franchise's operation even in unforeseen circumstances.