What is the process for Hck Hot Chicken to exercise its right to terminate the agreement?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ction or guilty plea, whichever first occurs, to sell its interest in Franchisee to Franchisee's other Owners; or (ix) Franchisee's and any Restricted Person's failure to comply with Section 12 or Section 20 of this Agreement.
- 14.3 Option to Terminate Without Opportunity to Cure. Franchisee shall be deemed to be in default and Franchisor may, at its option, terminate this Agreement and all rights granted hereunder, without affording Franchisee any opportunity to cure the default, effective immediately upon receipt of notice by Franchisor upon the occurrence of any of the following events:
- 14.3.1 Abandonment. If Franchisee shall abandon the Franchised Restaurant. For purposes of this Agreement, "abandon" shall refer to (i) Franchisee's failure, at any time during the term of this Agreement, to keep the Premises or Franchised Restaurant open and operating for business for a period of three consecutive days, except as provided in the HCK Hot Chicken Brand Standards Manual, (ii) Franchisee's failure to keep the Premises or Franchised Restaurant open and operating for any period after which it is not unreasonable under the facts and circumstances for Franchisor to conclude that Franchisee does not intend to continue to operate the Franchised Restaurant, unless such failure to operate is due to Force Majeure (subject to Franchisee's continuing compliance with this Agreement), (iii) failure to actively and continuously maintain and answer the telephone listed by Franchisee for the Franchised Restaurant solely with the "HCK Hot Chicken" name (as the same may be modified in accordance with this Agreement); (iv) the withdrawal of permission from the applicable lessor that results in Franchisee's inability to continue operation of the Franchised Restaurant; or (v) closing of the Franchised Restaurant required by Applicable Law if such closing was not the result of a violation of this Agreement by Franchisor.
- 14.3.2 Assignment, Death, or Incapacity. If Franchisee shall purport to make any Assignment without the prior written consent of Franchisor;
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 may terminate the franchise agreement without allowing the franchisee an opportunity to cure the default. This termination is effective immediately upon the franchisee's receipt of notice from Hck Hot Chicken. This can occur if the franchisee abandons the Franchised Restaurant. Abandonment includes failing to keep the restaurant open for three consecutive days (except as provided in the HCK Hot Chicken Brand Standards Manual), failing to keep the restaurant open for any period that leads Hck Hot Chicken to believe the franchisee doesn't intend to continue operations, failure to maintain and answer the telephone listed for the restaurant solely with the "HCK Hot Chicken" name, withdrawal of permission from the lessor resulting in the franchisee's inability to operate, or closing of the restaurant required by law if the closing resulted from a violation of the agreement by Hck Hot Chicken.
Additionally, Hck Hot Chicken can terminate the agreement without opportunity to cure in cases of assignment, death, or incapacity of the franchisee, or if the franchisee makes any material misrepresentations relating to the acquisition of the agreement. Termination can also occur if the franchisee's operation of the restaurant poses an imminent danger to public health, such as selling spoiled food or failing to comply with health codes, or if the franchisee, the initial Operating Principal, or the initial Restaurant Manager fails to complete all phases of the Initial Training Program or the Extra Practice Week to Hck Hot Chicken's satisfaction before opening the restaurant.
These termination rights are significant for prospective franchisees because they outline specific circumstances under which Hck Hot Chicken can immediately terminate the franchise agreement, potentially leading to a loss of investment without an opportunity to rectify the situation. Franchisees should carefully review these conditions and ensure they understand their obligations to avoid such defaults. It is also important to note that Hck Hot Chicken retains the right to modify the HCK Hot Chicken Brand Standards Manual, which could impact the franchisee's obligations and compliance requirements.