What agreement must a Chick Fil A Operator execute and deliver in the event of a transfer?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
- (f) The Operator shall execute and deliver an Assignment and Consent to Assignment, in the form prescribed by Chickfil-A (the "Assignment").
- (g) Under the Assignment, the Operator (and as applicable, the Operator-Owner) must agree to continue to be personally bound by, and personally liable for the breach of, each and every term and condition of this Agreement. Additionally, the Operator (and as applicable, the Operator-Owner) must guarantee the full and faithful performance by the proposed transferee business entity under this Agreement.
- (h) Under the Assignment, the proposed transferee business entity must agree to be bound by all of the provisions of this Agreement and to assume and discharge all of the Operator's obligations hereunder.
- (i) The Operator must provide Chick-fil-A with copies of all governing documents of the proposed transferee business entity (e.g., certificate of incorporation or organization, by-laws, stock certificates, operating agreement, membership certificates (if any), etc.) which must be reasonably satisfactory to Chick-fil-A in its sole and exclusive business judgment. The Operator will provide Chick-fil-A with copies of all such governing documents within 30 days following any request.
- (j) The Operator must maintain the transferee business entity in good standing in the jurisdiction of its formation, and if applicable, also as a foreign business entity in
the state in which the Business is located. The Operator will provide Chick-fil-A with evidence of good standing and legal existence within 30 days following any request.
Source: Item 23 — Receipts (FDD pages 103–600)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, in the event of a transfer, the Operator must execute and deliver an Assignment and Consent to Assignment, using the form prescribed by Chick-fil-A, referred to as "the Assignment".
Under the Assignment, the Operator (and the Operator-Owner, if applicable) must agree to remain personally bound by and liable for any breaches of the Franchise Agreement. They must also guarantee the full performance of the agreement by the proposed new business entity. This means that even after transferring the business, the original operator retains some responsibility for the franchise's adherence to the agreement.
Furthermore, the proposed new business entity taking over the Chick Fil A franchise must agree to be bound by all provisions of the Franchise Agreement and assume all of the Operator's obligations. This ensures that the new entity is fully responsible for fulfilling the terms of the agreement. The Operator must also provide Chick-fil-A with copies of all governing documents of the proposed transferee business entity, such as incorporation certificates, bylaws, and operating agreements, within 30 days of request. These documents must be reasonably satisfactory to Chick-fil-A.
Finally, the Operator is responsible for maintaining the transferee business entity in good standing within its jurisdiction of formation and, if applicable, as a foreign business entity in the state where the Chick Fil A business is located. Evidence of this good standing and legal existence must be provided to Chick-fil-A within 30 days of request. These requirements ensure that the transfer process is thorough and that the new entity is legally compliant and financially stable.