What are the consequences if a Chicken Guy developer begins construction before a fully-executed Franchise Agreement is in place?

According to the 2025 Chicken Guy Franchise Disclosure Document, a developer faces serious repercussions if they start building a franchised restaurant before having a fully-executed Franchise Agreement for that specific location. Chicken Guy has the right to terminate the Development Agreement immediately with written notice, and without giving the developer an opportunity to correct the situation. This is a significant risk for developers, as it could lead to a loss of investment in construction and potential legal disputes.

This policy underscores the importance of adhering strictly to Chicken Guy's development procedures and timelines. Developers must ensure that all necessary agreements are finalized before commencing any construction activities. This includes obtaining written site approval from Chicken Guy by the specified date and signing the Franchise Agreement within 90 days of site approval.

The franchisor's right to terminate the agreement without a cure period highlights the potential financial risks for a developer who jumps the gun on construction. The developer could lose not only the restaurant location but also the entire development agreement, impacting their ability to open other Chicken Guy franchises in the designated territory. This clause is designed to protect Chicken Guy's interests and ensure that all franchisees operate under the proper legal framework.

It is essential for prospective Chicken Guy developers to fully understand the terms and conditions of the Development Agreement and Franchise Agreement, particularly the sections regarding site approval, construction timelines, and termination rights. Seeking legal counsel to review these documents can help developers avoid costly mistakes and ensure compliance with Chicken Guy's requirements.