What does Hck Hot Chicken have the right to ensure during and after construction of the Franchised Restaurant?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
- 15.1 General. Upon the expiration or termination of Franchisee's rights granted under this Agreement:
- 15.1.1 Franchisee shall immediately cease to use all Trade Secrets, the Marks, and any confusingly similar trademark, service mark, trade name, logotype, or other commercial symbol or insignia. Franchisee shall immediately return the HCK Hot Chicken Brand Standards Manual, all training materials, electronic files, records, customer lists, files, advertising and promotional materials and all other written materials incorporating Trade Secrets and all copies of the whole or any part thereof to Franchisor. Franchisee shall at its own cost make cosmetic changes to the Franchised Restaurant so that it no longer contains or resembles Franchisor's proprietary designs, including: Franchisee shall remove all materials that would identify the
Premises and Location as a Restaurant operated under the Marks and System, and remove distinctive cosmetic features and finishes, soffits, interior wall coverings and colors, exterior finishes and colors and signage from the Premises and Location as Franchisor may reasonably direct and shall, at Franchisor's request, grant Franchisor access to the Premises to make cosmetic changes to the Franchised Restaurant so that it no longer resembles a Restaurant. Or in the alternative, if Franchisor so elects, at its sole option, upon any termination or expiration of this Agreement, Franchisor shall have an immediate right to enter and take possession of the Franchised Restaurant in order to maintain continuous operation of the Franchised Restaurant, to provide for orderly change of management and disposition of personal property and to otherwise protect Franchisor's interest.
- 15.1.2 If Franchisor so elects, at its sole option, upon any termination or expiration of this Agreement, Franchisee will sell to Franchisor such equipment and furnishings as Franchisor may designate that are associated with the Franchised Restaurant at their then-current fair market value.
If Franchisor and Franchisee cannot agree upon a fair market value for any equipment or furnishings, then Franchisor and Franchisee will each retain an independent appraiser at their own costs to prepare an appraisal of the fair market value and the average of the two appraisals shall be the fair market value and the purchase price.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
Based on the 2025 FDD, Hck Hot Chicken has specific rights regarding the appearance and standards of a franchised restaurant, particularly upon termination of the franchise agreement. Upon termination or expiration of the franchise agreement, the franchisee must immediately stop using Hck Hot Chicken's trade secrets and trademarks. The franchisee is also required to return the Hck Hot Chicken Brand Standards Manual, training materials, and other related documents to Hck Hot Chicken.
Furthermore, the franchisee is responsible for making cosmetic changes to the restaurant so that it no longer resembles Hck Hot Chicken's proprietary designs. This includes removing materials that identify the location as a Hck Hot Chicken restaurant, such as distinctive features, finishes, colors, and signage. Hck Hot Chicken may direct these cosmetic changes and, if requested, the franchisee must grant Hck Hot Chicken access to the premises to make these changes.
Alternatively, Hck Hot Chicken has the option to take immediate possession of the restaurant to maintain continuous operation, manage the change of ownership, dispose of personal property, and protect its interests. Additionally, Hck Hot Chicken can elect to purchase equipment and furnishings associated with the restaurant at their fair market value upon termination or expiration of the agreement. If the parties cannot agree on the fair market value, each will retain an independent appraiser, and the average of the two appraisals will determine the purchase price.