Does Article 1 of the Angry Chickz franchise agreement include any geographic limits?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
1.2 Certain Defined Terms. Unless otherwise defined in this Agreement, capitalized terms shall have the meanings set forth in Exhibit B.
described on Exhibit A under the heading "Protected Area."
1.1.3 "Location" means:
ARTICLE 2 GRANT
- 2.1 Grant.
Company hereby grants Franchisee, and Franchisee hereby accepts, the right, license and obligation, during the Term, to use and display the Marks, and to use the System, to operate one (1) Dine-in Restaurant at the Location and only at the Location, upon the terms and subject to the provisions of this Agreement.
The license granted under this Agreement does not include the rights to: (1) offer or sell products or services offered or sold by Restaurants at any location other than at the Location, or (2) offer or sell products or services offered or sold by Restaurants through any other channels of distribution, including delivery, catering, telephone, mail order, the internet (or any other existing or future form of electronic commerce), or distribution methods, other than those methods of accepting and fulfilling orders that are authorized in writing by Company.
As of the Effective Date, Company authorizes its franchisees, including Franchisee to accept orders for non-catering purposes through online, mobile and other forms of electronic commerce (e.g., online food ordering platforms) and fulfill the delivery of such orders at any location through permitted third party delivery services, all subject to and in accordance with the terms and conditions set forth in the Manuals.
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, Article 1 of the franchise agreement defines basic terms, including a reference to a "Protected Area" described in Exhibit A. Article 2 further clarifies that Angry Chickz grants the franchisee the right to operate one Dine-in Restaurant at a specific "Location" only. This license does not extend to other locations or distribution channels unless explicitly authorized by Angry Chickz in writing.
This means that an Angry Chickz franchisee's rights are generally limited to a specific location, and they cannot operate outside of this location without express permission. The franchisee is also restricted from using other channels of distribution, such as delivery or catering, unless Angry Chickz provides written authorization. However, Angry Chickz does authorize franchisees to accept orders for non-catering purposes through online, mobile, and other forms of electronic commerce and fulfill the delivery of such orders at any location through permitted third-party delivery services, subject to the terms and conditions set forth in the manuals.
The franchise agreement also states that the specific terms of the "Protected Area" are detailed in Exhibit A. This implies that franchisees may have some level of geographic exclusivity, preventing Angry Chickz from opening another franchise nearby. However, the exact extent and conditions of this protected area are not specified in this section and would need to be reviewed in Exhibit A of the Franchise Agreement.
Prospective Angry Chickz franchisees should carefully review Exhibit A to understand the specific geographic limitations and protections afforded to them. They should also inquire about the conditions under which Angry Chickz might authorize additional distribution channels or make exceptions to the location restriction. Understanding these limitations is crucial for assessing the potential market and competition in the franchisee's area.