Under what circumstances is the Chick Fil A agreement not assignable or transferable?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
- (k) Under the Assignment, and after any approved assignment during the remaining Agreed Term for any Business, the Operator-Owner shall continue to devote his or her full time and personal best efforts to operating the Business to attempt to achieve the highest sales and profits possible in a manner consistent with Chick-fil-A's operating standards and image in the community where the Business is located and in the nation as a whole, and to diligently develop and promote personally the reputation and the goodwill of the Business, the Marks and Chick-fil-A.
- 21.2 Except as expressly authorized and provided for above in this Section 21, this Agreement is not assignable or transferable in whole or in part by the Operator or, as applicable, the Operator-Owner, voluntarily or involuntary, including by will, trust or other instrument, by operation of law or otherwise. Accordingly, except as set forth above, the Operator (and, as applicable, the Operator-Owner) may not pledge, sell, assign, encumber, gift, transfer or hypothecate, directly or indirectly, in whole or in part, voluntarily or involuntarily, including by will, trust or other instrument, or by operation of law, this Agreement nor any legal or beneficial interest in this Agreement, the Businesses, the Sites or the approved transferee business entity, to any person or entity, and the Operator (and, as applicable, the Operator-Owner) further may not assign the Operator's estate or interest in or sublet the Sites or the Businesses. No proposed pledge, sale, assignment, encumbrance, gift, transfer or hypothecation, directly or indirectly, in whole or in part, voluntarily or involuntarily, including by will, trust or other instrument, or by operation of law or otherwise, of this Agreement, the Businesses, the Sites or any interest in any approved transferee business entity shall be made or of any force and effect without Chickfil-A's written consent and the Operator' full
and strict compliance with and performance of all the terms, conditions, representations, warranties, covenants and agreements of this Section 21 and
Source: Item 23 — Receipts (FDD pages 103–600)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the Franchise Agreement is generally not assignable or transferable by the Operator or Operator-Owner, either voluntarily or involuntarily. This includes transfers through a will, trust, or by operation of law, unless expressly authorized within the agreement. This restriction extends to any legal or beneficial interest in the agreement, the Businesses, the Sites, or any approved transferee business entity.
Specifically, the Operator or Operator-Owner cannot pledge, sell, assign, encumber, gift, transfer, or hypothecate the agreement or any related interests without Chick-fil-A's written consent and full compliance with the terms outlined in Section 21 of the Franchise Agreement. This also means the Operator cannot assign their estate or sublet the Sites or Businesses without Chick-fil-A's approval. Any attempt to transfer the agreement or related interests without Chick-fil-A's consent is considered void and without effect.
However, Chick-fil-A retains the right to assign the Delivery Kitchen Agreement to any person or entity at its discretion. The Operator is prohibited from transferring or assigning the Site, the Delivery Kitchen Unit, or any of the Equipment, Leasehold Improvements, or rights under the Delivery Kitchen Agreement, Additional Business Amendment, or DK Lease, unless permitted under the Franchise Agreement. Chick-fil-A maintains all rights associated with the ownership of the Equipment and the license or sublease of the Site, including depreciation rights for tax and accounting purposes.