What are the conditions that a Chicken Guy franchisee must comply with to be eligible for the first renewal term?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) At the expiration of the Initial Term, Franchisee shall have an option to remain a franchisee at the Franchised Location for two additional consecutive Renewal Terms of 5 years each. The conditions for renewal at the expiration of the Initial Term are set forth in this Section 2.B. The conditions for renewal at the expiration of the first Renewal Term shall be set forth in the franchise agreement in effect at that time. Franchisee must give Chicken Guy written notice of whether or not it intends to exercise its option for the first Renewal Term not less than 9 months, nor more than 12 months, before the expiration of the Initial Term. Failure to timely provide Chicken Guy the required notice constitutes a waiver by Franchisee of its option to remain a franchisee beyond the expiration of the Initial Term.
- (2) If Franchisee desires to continue as a franchisee for the first Renewal Term, Franchisee must comply with all of the following conditions prior to and at the end of the Initial Term:
- (a) Franchisee shall not be in default under this Agreement or any other agreements between Franchisee and Chicken Guy or its affiliates.
- (b) Franchisee shall renovate and modernize the Franchised Restaurant so that it conforms with the image of the System for new Chicken Guy! Restaurants for similar nontraditional locations at the time Franchisee provides Chicken Guy the renewal notice.
- (c) Franchisee shall have the right to remain in possession of the Franchised Location for the first Renewal Term.
- (d) Franchisee shall execute a general release and a covenant not to sue, in a form satisfactory to Chicken Guy, of any and all claims against Chicken Guy and its affiliates and their past and present officers, directors, shareholders, agents and employees, in their corporate and individual capacities.
- (e) Franchisee shall pay a renewal fee in the amount of 50% of Chicken Guy's then-current Initial Fees (including any Application Fees and Initial Franchise Fees) for a Nontraditional Location and execute a new franchise agreement for the first Renewal Term in the form then in general use by Chicken Guy (or, if Chicken Guy is not then granting franchises for Chicken Guy! Restaurants in Nontraditional Locations, that form of
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, a franchisee has the option to renew their franchise agreement for two additional 5-year terms after the initial term expires. To be eligible for the first renewal term, the franchisee must provide Chicken Guy with written notice of their intent to renew between 9 and 12 months before the initial term's expiration. Failure to provide this notice constitutes a waiver of the renewal option.
Prior to and at the end of the initial term, the franchisee must meet several conditions. First, they cannot be in default under the current Franchise Agreement or any other agreements with Chicken Guy or its affiliates. Second, the franchisee must renovate and modernize the franchised restaurant to match the current image of new Chicken Guy restaurants for similar nontraditional locations at the time of renewal. Third, the franchisee must have the right to remain in possession of the franchised location for the renewal term.
Additionally, the franchisee must execute a general release and a covenant not to sue Chicken Guy and its affiliates, including their officers, directors, shareholders, agents, and employees, in a form satisfactory to Chicken Guy. Finally, the franchisee must pay a renewal fee equal to 50% of Chicken Guy's then-current initial fees for a Nontraditional Location (including any Application Fees and Initial Franchise Fees) and execute a new franchise agreement for the first renewal term, using the form then in general use by Chicken Guy.