How does Chick Fil A automatically extend the term of the Food Truck License Agreement?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
The Initial Term, together with any and all extensions of the Initial Term and subject to the rights for earlier termination or expiration pursuant to this Agreement or the Franchise Agreement or the Food Truck Lease, is sometimes referred to in this Agreement as the "Term." Unless this Agreement or the Franchise Agreement or the Food Truck Lease (as defined below) is terminated or expires earlier, the Term of this Agreement will be automatically extended for successive additional periods of one (1) year, unless written notice of intent not to renew either the Franchise Agreement or this Agreement is given by either party to the other at least thirty (30) days prior to the end of the Term; provided, however, that this Agreement may not be renewed if the Operator does not have the right to renew the Franchise Agreement or does not have the right to renew the Franchise Agreement with respect to the Business or the Franchise Agreement is terminated or otherwise not renewed, as provided in Section 2.3 of the Franchise Agreement.
Chick-fil-A will have the right to change the terms and conditions of this Agreement upon a renewal of the Franchise Agreement pursuant to Section 2.4 of the Franchise Agreement (and renewal of this Agreement) by giving the Operator a written notice of the changed terms and conditions at least forty-five (45) days prior to the end of the then-current Term, in which case the Operator will have fifteen (15) days from the date of the notice to decide and to notify Chick-fil-A in writing of the Operator's decision to either renew or not renew this Agreement upon the changed terms and conditions offered.
The Operator's failure to provide timely notice to Chick-fil-A of a decision to either renew or not renew this Agreement upon the changed terms and conditions offered will be deemed to be an election by the Operator to terminate this Agreement at the end of such Term.
Source: Item 23 — Receipts (FDD pages 103–600)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the Food Truck License Agreement's term is automatically extended for additional one-year periods unless either party provides written notice of their intent not to renew at least 30 days before the current term ends. The initial term begins on the agreement's effective date and concludes on December 31 of that year.
However, this automatic renewal is contingent upon the operator's right to renew the Franchise Agreement itself. If the operator loses the right to renew the Franchise Agreement, particularly concerning the specific business, or if the Franchise Agreement is terminated or not renewed, the Food Truck License Agreement cannot be renewed.
Chick-fil-A also retains the right to modify the terms and conditions of the Food Truck License Agreement upon renewal of the Franchise Agreement. In such cases, Chick-fil-A must provide written notice of these changes to the operator at least 45 days before the end of the current term. The operator then has 15 days to decide whether to accept the new terms and notify Chick-fil-A accordingly. Failure to provide timely notice is considered an election to terminate the agreement at the end of the term.