If Hck Hot Chicken exercises its right of first refusal, what fees are waived?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisor elects to exercise the ROFR, Franchisor or its nominee, as applicable, shall send written notice of such election to Franchisee within 60 days of receipt of Franchisee's request (the "ROFR Period").
If Franchisor accepts such offer, the training and transfer/administrative fees due by Franchisee in accordance with this Agreement shall be waived by Franchisor, and the closing of the transaction shall occur within 60 days following the date of Franchisor's acceptance.
Any material change in the terms of an offer prior to closing (or the failure to close the transaction within 60 days following the written notice provided by Franchisee) shall cause it to be deemed a new offer, subject to the same right of first refusal by Franchisor, or its third party designee, as in the case of the initial offer.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to the 2025 Hck Hot Chicken Franchise Disclosure Document, if Hck Hot Chicken elects to exercise its Right of First Refusal (ROFR) to purchase a franchise from a franchisee, certain fees are waived. Specifically, the training and transfer/administrative fees that would normally be due from the franchisee are waived by Hck Hot Chicken.
This waiver of fees is contingent upon Hck Hot Chicken providing written notice of its election to exercise the ROFR within 60 days of receiving the franchisee's request to sell the franchise. The closing of the transaction must then occur within 60 days following Hck Hot Chicken's acceptance of the offer.
It is important to note that any material change in the terms of the offer prior to closing, or failure to close the transaction within the 60-day timeframe, is considered a new offer and is again subject to Hck Hot Chicken's right of first refusal. This ensures that Hck Hot Chicken maintains control over franchise ownership changes and can step in if it deems it beneficial. This clause protects Hck Hot Chicken from potentially unfavorable transfers while providing some financial relief to the franchisee in the event of a buy-back.