What agreements outline the pre-opening purchase/leases obligations for a Chick Fil A franchise?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
d to comply with the terms of the food truck lease either under the sublease under or, as applicable, direct lease attached to your Food Truck License Agreement.
Chick-fil-A provides extended payment terms for certain pre-opening expenditures under the Franchise Agreement and also rents equipment to its Operators under the Lease and under the Concession Sublicense Agreement for a captive venue unit and the Delivery Kitchen Agreement for a delivery kitchen unit. The monthly equipment rental fee is based on the fair market rental value as determined by Chick-fil-A from time to time in its sole and exclusive business judgment, currently $750 to $5,000 per month depending on the type of location (free-standing, in-line, drive-thru only, mall, captive venue or delivery kitchen units), exclusive of any applicable sales, use and property taxes, for each franchised Chick-fil-A Restaurant operated by an Operator. The term of the extended payment terms for the pre-opening expenditures and the term of the equipment lease are the same as the term of your Franchise Agreement. The equipment rental for a captive venue unit and delivery kitchen unit could be less than the amount stated above for a captive venue unit or delivery kitchen unit, including if the owner, licensor or manager of the premises provides certain equipment, or more including if the venue is large.
Under the Franchise Agreement, Chick-fil-A will retain a security interest in any business equipment owned by you and your business. If Chick-fil-A allows you to assign the Franchise Agreement to a form of business entity then approved by Chick-fil-A, you must under the Assignment and Consent to Assignment Agreement that must be signed as a condition of any assignment attached to this Disclosure Document as
Exhibit "B-1" for a corporation and Exhibit "B-2" for a limited liability company personally guarantee the Franchise Agreement, including its attached Lease(s), any Concession Sublicense Agreement(s) for captive venue units. (Franchise Agreement, Section 21, any Delivery Kitchen Agreement(s) for delivery kitchen units. (Franchise Agreement, Section 21, Assignment and Consent to Assignment Agreement, Section 2, Additional Business Amendment (Business Entity), Section 8). See Items 5, 6 and 15 for more information.
Source: Item 9 — Franchisee's Obligations (FDD pages 49–51)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the pre-opening purchase and lease obligations are detailed within several key agreements. The Franchise Agreement itself, including its attached Lease(s), is the primary document governing the relationship between Chick Fil A and its Operators. For non-traditional locations like captive venue units and delivery kitchen units, additional agreements such as the Concession Sublicense Agreement and the Delivery Kitchen Agreement, respectively, come into play. These agreements outline the terms related to the occupancy and use of the premises.
Specifically, the Lease attached to the Franchise Agreement dictates the terms of occupancy for each restaurant premises controlled by Chick Fil A. In situations where Chick Fil A subleases the restaurant premises from a prime lease or ground lease, a wholly-owned subsidiary of Chick Fil A may act as the landlord. For delivery kitchen units, the Delivery Kitchen Agreement and its attached DK Lease substitute the standard Lease, outlining the sublicense or sublease terms under which the Operator uses the premises and agrees to fulfill Chick Fil A's obligations under the DK Lease.
Furthermore, Chick Fil A provides extended payment terms for certain pre-opening expenditures under the Franchise Agreement and also rents equipment to its Operators under the Lease, the Concession Sublicense Agreement, and the Delivery Kitchen Agreement. The monthly equipment rental fee, which ranges from $750 to $5,000 depending on the location type, is determined by Chick Fil A. These agreements collectively ensure that the obligations and responsibilities of both Chick Fil A and the franchisee are clearly defined and legally binding.