What happens to the Operator's obligations under the Chick Fil A agreement after termination?
Chick_Fil_A Franchise · 2025 FDDAnswer from 2025 FDD Document
- c. The Operator will bear any and all risk arising from or related to termination of this Agreement. Upon termination of this Agreement, the Operator will remain liable for the then current outstanding balance of the Food Truck Fee, the Food Truck Insurance Fee and any other payments due Chick-fil-A or the Food Truck Lessor as provided in the Food Truck Lease and/or in this Agreement. The Operator agrees that upon default the Food Truck Lessor may demand, receive and collect any monies due or falling due after the default without in any manner affecting the status of the default or any notice of suit, action, order or judgment related to the default. Upon termination of the Food Truck Lease and/or this Agreement, any payment made by the Operator to Chick-fil-A or the Food Truck Lessor or any court will not: (i) reinstate, continue or extend the term of this Agreement; (ii) affect any notice previously given to the Operator; or (iii) pursuant to the terms and conditions of the Food Truck Agreement, operate as a waiver of the right of the Food Truck Lessor or, as applicable, Chick-fil-A to obtain possession of the Food Truck by proper suit, action, proceeding or remedy. All monies collected will be deemed to be payments made in accordance with the terms of this Agreement or applied toward any outstanding balances owed by the Operator.
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- Survival. Upon the termination, expiration, or suspension of this Agreement as provided in Section 14, all obligations under this Agreement, including without limitation the obligations under the Franchise Agreement which are incorporated by reference into this Agreement, that expressly or by their nature are intended to survive the termination or expiration of this Agreement or the Franchise Agreement, including, but not limited to, limitations of liability, and the Operator's reporting, payment and indemnification obligations to Chick-fil-A and/or the Food Truck Lessor, will survive the termination, expiration or suspension of this Agreement, the Food Truck Lease, and the termination of the Franchise Agreement, if applicable.
Source: Item 23 — Receipts (FDD pages 103–600)
What This Means (2025 FDD)
According to Chick Fil A's 2025 Franchise Disclosure Document, the Operator has several obligations that survive the termination, expiration, or suspension of the agreement. The Operator bears all risks related to the termination of the agreement. Specifically, the Operator remains liable for outstanding balances, such as the Food Truck Fee and Food Truck Insurance Fee, as well as any other payments due to Chick Fil A or the Food Truck Lessor, as outlined in the Food Truck Lease or the agreement itself.
Chick Fil A details that payments made by the Operator to Chick Fil A, the Food Truck Lessor, or any court will not reinstate or extend the agreement, affect previously given notices, or waive the right of the Food Truck Lessor or Chick Fil A to repossess the Food Truck. All collected monies will be applied towards outstanding balances owed by the Operator.
Furthermore, all obligations under the agreement, including those incorporated from the Franchise Agreement, that are intended to survive termination, such as limitations of liability, and the Operator's reporting, payment, and indemnification obligations to Chick Fil A and/or the Food Truck Lessor, will continue even after the termination, expiration, or suspension of the agreement, the Food Truck Lease, and the Franchise Agreement, if applicable. This ensures that certain responsibilities and liabilities of the Operator continue even after the agreement is no longer in effect.