What is the exception to the 60-day written notice requirement for terminating the Chicken Guy Franchise Agreement?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the foregoing, this Agreement shall automatically terminate if Franchisee's contract to provide foodservice at the Facility terminates or expires without renewal. In addition, Franchisee may terminate this Agreement following 60 days' written notice to Chicken Guy if Franchisee's client at the Facility instructs Franchisee in writing to cease operating the Franchised Restaurant (provided Franchisee has exercised reasonable efforts to arrange a meeting between Franchisee's client and Chicken Guy, if Chicken Guy so elects, to discuss the continued operation of the Franchised Restaurant). If Franchisee's contract to provide foodservice at the Facility permits Franchisee's client to take this action on shorter notice, the notice period provided in that contract shall govern, provided Franchisee has provided Chicken Guy a copy of the relevant contract provision.
Source: Item 23 — RECEIPTS (FDD pages 50–286)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, there is an exception to the standard 60-day written notice requirement for termination of the franchise agreement. Specifically, if the franchisee's contract to provide foodservice at a facility permits the client to terminate the contract on shorter notice, then that shorter notice period will govern the termination of the Chicken Guy franchise agreement. However, the franchisee must provide Chicken Guy with a copy of the relevant contract provision.
This exception applies specifically when the Chicken Guy restaurant is located within a facility where the franchisee's right to operate is dependent on a foodservice contract with the facility owner or operator. This is common in non-traditional locations such as airports, universities, or corporate cafeterias. If the facility client decides to terminate its contract with the franchisee, the Chicken Guy franchise can be terminated with the same reduced notice period.
For a prospective Chicken Guy franchisee, this means that the stability of their franchise is tied to the foodservice contract they have with the facility. If that contract allows for quick termination, the Chicken Guy franchise agreement can also be terminated quickly. This adds a layer of risk beyond the typical franchise agreement terms, as the franchisee's business is dependent on maintaining a good relationship with the facility client and adhering to the terms of their foodservice contract. It is important for a potential franchisee to carefully review the terms of their foodservice contract and understand the conditions under which it can be terminated, as this will directly impact the security of their Chicken Guy franchise.