What are the terms of the Hck Hot Chicken franchisor's right of first refusal?
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.
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.
The ROFR is fully assignable by Franchisor.
Without waiving any other rights provided for herein or otherwise, Franchisor hereby waives its ROFR if the proposed transferee/assignee is an immediate family member of Franchisee;
(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 the 2025 Hck Hot Chicken FDD, the franchisor has a right of first refusal (ROFR) if a franchisee wants to sell their franchise. If Hck Hot Chicken decides to exercise this right, they must notify the franchisee in writing within 60 days of receiving the franchisee's request to sell. This 60-day period is referred to as the "ROFR Period."
If Hck Hot Chicken accepts the offer, the franchisee won't have to pay training or transfer/administrative fees that would normally be required. The sale must then be completed within 60 days of Hck Hot Chicken's acceptance. If the terms of the sale change significantly before closing, or if the sale doesn't close within that 60-day window, it's considered a new offer, and Hck Hot Chicken's right of first refusal applies again.
The FDD specifies that if Hck Hot Chicken doesn't exercise its right of first refusal, it doesn't mean they approve the transfer or waive any other requirements for the transfer. The right of first refusal can be assigned by Hck Hot Chicken to another party. However, Hck Hot Chicken waives its ROFR if the proposed buyer is an immediate family member of the franchisee. The franchisee must not be in default and must execute a general release of claims against Hck Hot Chicken.