What is the summary of the Hck Hot Chicken Franchise Agreement provisions related to terminations?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ad these provisions in the agreements attached to this Disclosure Document.**
A. FRANCHISE AGREEMENT
| Provision | Agreement | Summary |
|---|---|---|
| a. Length of the franchise | Section 3.1 | Ten years from date the Restaurant first opens to the public. |
| term | ||
| b. Renewal or extension of the term | Section 3.2 - 3.3 | If you are in good standing and you meet other requirements, you may enter into two consecutive successor franchise agreements, each with a ten-year term. You may be asked to sign a contract with materially different terms and conditions than your original contract. You have no further right to enter into additional successor franchise agreements but may apply for the right to operate a Restaurant pursuant to a new franchise agreement. |
| c. |
Source: Item 17 — RENEWAL, TERMINATIONS, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 44–51)
What This Means (2025 FDD)
Based on the 2025 Hck Hot Chicken Franchise Disclosure Document, Item 17 provides details on termination, renewal, transfer, and dispute resolution of the franchise agreement. The franchise agreement lasts for ten years from the date the restaurant opens. If the franchisee is in good standing and meets other requirements, they may enter into two consecutive successor franchise agreements, each with a ten-year term. However, Hck Hot Chicken may ask the franchisee to sign a contract with materially different terms and conditions than their original contract. The franchisee has no further right to enter into additional successor franchise agreements but may apply for the right to operate a Restaurant pursuant to a new franchise agreement.
Regarding non-competition covenants after the franchise is terminated or expires, the franchisee is prohibited, without Hck Hot Chicken's express written consent, from involvement in any Competitive Activities, as defined in the agreement, for 2 years within the Development Area. Competitive Activities include businesses engaged in the sale of fried chicken, or any business engaged in the preparation, production, or sale, at wholesale, of any fried chicken food product. However, Competitive Activities do not include the direct or indirect ownership solely as an investment, of securities of any entity which are traded on any national securities exchange if the owner thereof (i) is not a controlling person of, or a member of a group which controls, such entity and (ii) does not, directly or indirectly, own 5% or more of any class of securities of such entity.
The Franchise Agreement outlines specific conditions under which Hck Hot Chicken can terminate the franchise agreement. These conditions likely include failure to meet performance standards, non-compliance with brand standards, or breach of contract. Prospective franchisees should carefully review the full Item 17 and the referenced sections of the Franchise Agreement to fully understand their rights and obligations regarding termination, transfer, and renewal.