Under what condition can an Angry Chickz developer own or operate a Restaurant?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
While in my position with the Franchisee, I will not own (either beneficially or of record), engage in or render services to, whether as an investor, partner, lender, director, officer, manager, employee, consultant, representative or agent, any restaurant or business that (i) specializes in developing, owning, operating or franchising restaurants 25% or more of whose gross sales is derived from the sale of boneless breaded chicken; (ii) any business engaged in the preparation, production or sale, at wholesale, of any boneless breaded chicken food products; or (iii) any restaurant or business that looks like, copies, imitates, operates with similar trade dress or décor, or is otherwise substantially the same as or similar to Angry Chickz Restaurants.
This restriction does not apply to my ownership of less than a five percent (5%) beneficial interest in the outstanding securities of any publicly-held corporation.
Source: Item 23 — RECEIPTS (FDD pages 54–260)
What This Means (2025 FDD)
According to the 2025 Angry Chickz Franchise Disclosure Document, a developer's ability to own or operate a restaurant is subject to certain conditions and restrictions, particularly concerning competition and territorial rights. Specifically, while in a position with the franchisee, an individual is restricted from owning, engaging in, or providing services to any restaurant or business that specializes in developing, owning, operating, or franchising restaurants where 25% or more of gross sales are from boneless breaded chicken. This also applies to businesses involved in the wholesale production or sale of boneless breaded chicken products, or any restaurant that closely resembles an Angry Chickz restaurant. However, this restriction does not apply to ownership of less than a 5% beneficial interest in the securities of a publicly-held corporation.
Angry Chickz also reserves specific rights regarding development and operation. The company can develop, own, and franchise restaurants outside the developer's designated area, regardless of proximity. They can also operate businesses under different names, including restaurants at non-traditional venues, both within and outside the development area. This allows Angry Chickz to maintain control over its brand and market presence, even within areas where a developer has rights.
Furthermore, the developer is prohibited from subfranchising or assigning franchise agreements to third parties without Angry Chickz's prior written consent. However, a developer may assign a franchise agreement to a separate entity (a Subsidiary) controlled by the developer, provided certain conditions are met. These conditions include the subsidiary's activities being confined to operating the Angry Chickz restaurant, the developer maintaining 100% ownership and control of the subsidiary, and the subsidiary being in good standing in its jurisdiction. These stipulations ensure that while a developer can utilize a subsidiary for operational purposes, Angry Chickz retains control over the franchise and its standards.