Besides operating other Chicken Guy restaurants, what other restaurant operations are Chicken Guy franchisees allowed to engage in?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
(3) Franchisee agrees that it will at all times faithfully, honestly and diligently perform its obligations under this Agreement, that it will continuously exert reasonable efforts to promote and enhance the business of the Franchised Restaurant and that it will not engage in any other business or activity that may conflict with its obligations under this Agreement, except the operation of other Chicken Guy! Restaurants or other restaurants operated by Franchisee that are franchised by Chicken Guy or its affiliates.
(2) Accordingly, Franchisee covenants and agrees that during the term of this Agreement, and for a continuous period of 1 year following its expiration or earlier termination, Franchisee shall not, either directly or indirectly, for itself, or through, on behalf of, or in conjunction with, any person, firm, partnership, corporation, or other entity:
(b) Own, maintain, operate, engage in, advise, help, make loans to, or have any interest in, either directly or indirectly, any restaurant business: (i) that features chicken as a primary menu item (i.e., sales of chicken menu items comprise at least 20% of sales); or (ii) whose method of operation or trade dress is similar to that employed in the System.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, franchisees are generally prohibited from engaging in any other business or activity that may conflict with their obligations under the franchise agreement. However, an exception exists that allows franchisees to operate other restaurants franchised by Chicken Guy or its affiliates, in addition to their Chicken Guy restaurant.
This means a franchisee can own and operate multiple Chicken Guy locations or other restaurant concepts that are also franchised by Chicken Guy or its affiliates. This provides an opportunity for franchisees looking to diversify their business interests within the Chicken Guy franchise system.
However, franchisees are restricted from owning or operating any restaurant business that features chicken as a primary menu item (at least 20% of sales) or whose method of operation or trade dress is similar to the Chicken Guy system. These restrictions apply during the term of the franchise agreement and for one year after its expiration or termination. This is to protect Chicken Guy's brand and prevent franchisees from using the franchisor's confidential information to compete against the system.