During the Development Term for Chicken Guy, can the Developer own, maintain, or operate a restaurant business that features chicken as a primary menu item?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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.
During the Development Term, there is no geographical limitation on this restriction.
Following the expiration or earlier termination of the Development Term, this restriction shall apply within the Development Territory, within 2 miles of the border of the Development Territory and within 2 miles of any then-existing Chicken Guy!
Restaurant, except as otherwise approved in writing by Chicken Guy.
This restriction shall not apply to Developer's existing restaurant or foodservice operations, if any, which are identified in the attached Data Sheet, nor shall it apply to other restaurants operated by Developer that are franchised by Chicken Guy or its affiliates.
- (3) If any part of these restrictions is found to be unreasonable in time or distance, each month of time or mile of distance may be deemed a separate unit so that the time or distance may be reduced by appropriate order of the court to that deemed reasonable.
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, during the Development Term, a developer is restricted from owning, maintaining, or operating any restaurant business that features chicken as a primary menu item. A restaurant is considered to feature chicken as a primary menu item if sales of chicken menu items comprise at least 20% of sales. This restriction also applies to any restaurant business whose method of operation or trade dress is similar to that employed in the Chicken Guy system.
During the Development Term, this restriction has no geographical limitation. However, after the Development Term expires or is terminated, the restriction applies within the Development Territory, within 2 miles of the border of the Development Territory, and within 2 miles of any then-existing Chicken Guy restaurant.
This restriction does not apply to the developer's existing restaurant or foodservice operations, if any, which are identified in the attached Data Sheet, nor does it apply to other restaurants operated by the developer that are franchised by Chicken Guy or its affiliates. If any part of these restrictions is found to be unreasonable in time or distance, the time or distance may be reduced by the court to what is deemed reasonable.