How long after Chicken Guy's Purchase Notice does the closing of the asset purchase take place?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
The Purchase Price shall be paid in cash or cash equivalents at the closing of the purchase ("Closing"), which shall take place no later than 60 days after the date of Chicken Guy's Purchase Notice.
From the date of Chicken Guy's Purchase Notice until Closing:
(1) Franchisee shall operate the Franchised Restaurant and maintain the Assets in the usual and ordinary course of business and maintain in full force all insurance policies required under this Agreement; and
(2) Chicken Guy shall have the right to appoint a manager, at Chicken Guy's expense, to control the day-to-day operations of the Franchised Restaurant, and Franchisee shall cooperate, and instruct its employees to cooperate, with the manager appointed by Chicken Guy.
Alternatively, Chicken Guy may require Franchisee to close the Franchised Restaurant during such time period without removing any Assets from the Franchised Restaurant.
- **F.
Due Diligence Period.** For a period of 30 days after the date of Chicken Guy's Purchase Notice ("Due Diligence Period"), Chicken Guy shall have the right to conduct such investigations as it deems necessary and appropriate to determine: (1) the ownership, condition and title of the Assets; (2) liens and encumbrances on the Assets; (3) environmental and hazardous substances at or upon the Franchised Location; and (4) the validity of contracts and liabilities inuring to Chicken Guy or affecting the Assets, whether contingent or otherwise.
Franchisee will afford Chicken Guy and its representatives access to the Franchised Restaurant and the Franchised Location at all reasonable times for the purpose of conducting inspections of the Assets; provided that such access does not unreasonably interfere with Franchisee's operations of the Franchised Restaurant.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, the closing of the asset purchase will occur no later than 60 days after the date of Chicken Guy's Purchase Notice. Chicken Guy provides the Purchase Notice in writing to the franchisee to exercise its option to purchase the assets. The purchase price will be paid in cash or cash equivalents at the closing.
From the date of the Purchase Notice until the Closing, the franchisee is obligated to operate the franchised restaurant and maintain the assets in the usual and ordinary course of business, keeping all required insurance policies in full force. During this period, Chicken Guy has the right to appoint a manager, at its own expense, to oversee the day-to-day operations of the restaurant, and the franchisee must cooperate with this manager. Alternatively, Chicken Guy can require the franchisee to close the restaurant during this time without removing any assets.
Chicken Guy also has a Due Diligence Period of 30 days after the Purchase Notice to investigate the assets. This period allows Chicken Guy to assess the ownership, condition, and title of the assets, check for any liens or encumbrances, evaluate environmental and hazardous substances at the location, and verify the validity of contracts and liabilities affecting the assets. The franchisee must provide Chicken Guy and its representatives access to the restaurant and location for inspections during this period, ensuring it does not unreasonably interfere with the restaurant's operations.