What must a Chicken Guy developer do to advise Chicken Guy of a proposed transfer?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- B. Transfer Considerations. Developer shall advise Chicken Guy in writing of any proposed Transfer, submit (or cause the proposed transferee to submit) a franchise application for the proposed transferee and submit a copy of all contracts and all other agreements or proposals, and all other information requested by Chicken Guy, relating to the proposed Transfer. If Chicken Guy does not exercise its right of first refusal, the decision as to whether or not to approve a proposed Transfer shall be made by Chicken
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, a developer who is considering a transfer of their interest in the franchise must provide written notice to Chicken Guy regarding the proposed transfer. The developer must also submit a franchise application for the proposed transferee, or ensure that the proposed transferee submits one. Furthermore, the developer needs to provide copies of all contracts, agreements, proposals, and any other information that Chicken Guy requests related to the potential transfer.
Chicken Guy has the right of first refusal, meaning they can choose to purchase the developer's interest on the same terms offered by a third party. If Chicken Guy waives this right, they will then evaluate the proposed transfer based on various factors. These factors include the transferee's experience in high-quality restaurant operations, their managerial and operational standards, character, business reputation, credit rating, compatibility with Chicken Guy's management culture, and adequate financial resources.
Chicken Guy also assesses whether the proposed sales price is reasonable and won't jeopardize the transferee's ability to successfully operate the franchise. The developer must ensure that all outstanding financial obligations to Chicken Guy and related entities are satisfied or adequately provided for. Chicken Guy may require a reasonable sum of money to be placed in escrow to ensure these obligations are met. These stipulations are in place to protect the Chicken Guy brand and ensure that any new developer is well-qualified and financially stable.