What are a Browns Chicken franchisee's obligations upon termination or non-renewal of the Franchise Agreement?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Agreement | Summary |
|---|---|---|
| (i) Franchisee’s obligations on | 21A-F | Payment of all sums due Brown; must stop use of proprietary |
| termination/non-renewal | information, no competition. | |
| (r) Non-competition covenants after the franchise is terminated or expires | 21E | No competition within a 5 mile radius of any BROWN’s Store for 18 months. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 36–38)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, Item 17 outlines the franchisee's obligations upon termination or non-renewal of the Franchise Agreement. Specifically, the franchisee must make payment of all sums due to Browns Chicken. Additionally, the franchisee is obligated to cease all use of Browns Chicken's proprietary information.
Furthermore, the franchisee is restricted from engaging in any competitive activities. This non-compete clause prevents the franchisee from competing within a 5-mile radius of any Browns Chicken store for a period of 18 months following the termination or expiration of the franchise agreement.
These obligations are fairly standard in the franchise industry, as franchisors typically seek to protect their brand, trade secrets, and customer base after a franchise agreement ends. Prospective Browns Chicken franchisees should carefully consider these post-termination obligations and how they might impact their future business endeavors.