What is the consequence of failing to obtain Chicken Guy's prior written consent for a transfer?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Except as otherwise provided in this Agreement, any purported Transfer, by operation of law or otherwise, not having the prior written consent of Chicken Guy shall be null and void and shall constitute a material breach of this Agreement, for which Chicken Guy may terminate this Agreement without providing Franchisee an opportunity to cure the breach.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, transferring any interest in the franchise without prior written consent from Chicken Guy constitutes a material breach of the franchise agreement. This includes selling, assigning, or otherwise encumbering any interest in the franchise, the franchised restaurant, its assets, or the franchised location.
If a franchisee attempts a transfer without obtaining the required prior written consent from Chicken Guy, such a transfer will be considered null and void. Furthermore, this unauthorized transfer provides Chicken Guy with the right to terminate the franchise agreement. Importantly, Chicken Guy can exercise this termination right without offering the franchisee an opportunity to correct, or 'cure,' the breach.
This requirement underscores the importance Chicken Guy places on the personal skills, financial capacity, and operational abilities of its franchisees. By requiring prior consent, Chicken Guy retains control over who operates its franchises and ensures that all franchisees meet their standards. This provision is typical in franchising, as franchisors need to maintain brand consistency and protect their system.