On what page of the Browns Chicken franchise agreement is assignment discussed?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall not assign or in any manner transfer the lease or sublease, as the case may be, for the Premises or any interest therein (except in connection with an assignment or transfer of the Franchise or ownership of Franchisee approved by Brown as provided in Section 22), or further sublet the Premises or any part or parts thereof, nor permit occupancy by anyone with, through, or under Franchisee.
Franchisee shall not execute a lease which has for any reason been disapproved by Brown. Franchisee shall deliver a copy of the signed lease for the Premises to Brown within fifteen (15) days of its execution. Franchisee shall execute a Collateral Assignment of Lease, attached hereto as Rider B, by which Franchisee assigns to Brown all of his right, title and interest as tenant under the lease for the Store premises. The assignment is for collateral purposes and may be exercised only upon a default by Franchisee under his lease or under this Agreement. Brown's approval of Franchisee's lease is conditioned on receipt of the signed Collateral Assignment.
Franchisee's execution of a lease for a site for the Store shall constitute acceptance by Franchisee of such site and location and of the terms of such lease, sublease or purchase.
Brown's approval of the lease or sublease does not constitute a warranty or representation of any kind, express or implied, as to its fairness, suitability or profitability or as to Franchisee's ability to comply with its terms.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, Section 22 discusses the contracts and agreements that a franchisee will be subject to. Specifically, it outlines the conditions regarding the assignment or transfer of the franchise agreement or the lease of the premises.
The franchisee cannot assign or transfer the lease or sublease for the premises without Brown's Chicken's approval, except when it's connected to an approved franchise or ownership transfer. Additionally, the franchisee must not execute a lease that Brown's has disapproved. A copy of the signed lease must be delivered to Brown's within 15 days of execution, along with a Collateral Assignment of Lease, which assigns the franchisee's rights as a tenant to Brown's. This assignment serves as collateral and can be exercised if the franchisee defaults on the lease or the Franchise Agreement.
Furthermore, the franchisor's approval of the lease doesn't provide any guarantees about its fairness, suitability, profitability, or the franchisee's ability to comply with its terms. If a franchisee wants to transfer their franchise, the transferee must meet several conditions, including executing an assignment and assumption agreement or Brown's current Franchise Agreement, and the lessor of the premises must consent to the assignment or sublease. The selling franchisee may also remain liable for the transferee's obligations under the Franchise Agreement. The FDD does not specify the exact page number where these assignment conditions are listed.