Does Hck Hot Chicken's consent to an assignment waive any claims it may have against the transferring party?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor's failure to exercise such ROFR shall not constitute consent to the transfer or a waiver of any other provision of this Agreement, including any of the requirements of this Section with respect to the proposed transfer.
(d) The Franchisee shall not be in default under the terms of this Agreement (or any other related agreement), the HCK Hot Chicken Brand Standards Manual or any other obligations owed Franchisor, and all of its then-due monetary obligations to Franchisor shall have been paid in full;
(e) The Franchisee, and its Owners, if the Franchisee is an Entity, shall execute a general release under seal, in a form prescribed by Franchisor, of any and all claims against Franchisor, its Affiliates, Owner(s), directors, officers, agents and employees;
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, Hck Hot Chicken's failure to exercise its right of first refusal (ROFR) does not automatically constitute consent to the transfer or a waiver of any other provisions within the franchise agreement. This means that even if Hck Hot Chicken chooses not to buy the franchise back itself, it still retains the right to enforce other terms of the agreement regarding the transfer.
However, to proceed with a transfer that Hck Hot Chicken consents to, the franchisee must not be in default of the franchise agreement or any related agreements, including the Hck Hot Chicken Brand Standards Manual. All monetary obligations owed to Hck Hot Chicken must be paid in full at the time of the transfer. Additionally, the franchisee, and its owners if the franchisee is a business entity, must execute a general release in a form prescribed by Hck Hot Chicken, which releases Hck Hot Chicken from any and all claims.
In practical terms, a franchisee looking to transfer their Hck Hot Chicken franchise needs to ensure they are fully compliant with all aspects of their franchise agreement. They must also be prepared to sign a release that prevents them from pursuing any future claims against Hck Hot Chicken once the transfer is complete. This requirement protects Hck Hot Chicken from potential liabilities or disputes arising from the previous franchisee's operation of the business.