After the Chicken Guy Franchise Agreement expires or terminates, where does the restriction against competitive businesses apply?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Following the expiration or earlier termination of the term of this Agreement, this restriction shall apply within the Protected Area 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 Franchisee'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 Franchisee that are franchised by Chicken Guy or its affiliates.
- (4) 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.
If, at any time during the 1-year period following expiration or earlier termination of this Agreement, Franchisee fails to comply with its obligations under this Section, that period of noncompliance will not be credited toward Franchisee's satisfaction of the 1-year obligation.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, following the expiration or termination of the Franchise Agreement, the restriction against competitive businesses applies within the franchisee's Protected Area and within 2 miles of any then-existing Chicken Guy restaurant. This is unless Chicken Guy approves otherwise in writing.
The restriction does not apply to the franchisee's existing restaurant or foodservice operations, if any, that are identified in the attached Data Sheet. It also does not apply to other restaurants operated by the franchisee that are franchised by Chicken Guy or its affiliates.
The FDD also states that 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. Additionally, if the franchisee fails to comply with their obligations under this section during the 1-year period following expiration or termination, that period of noncompliance will not be credited toward the franchisee's satisfaction of the 1-year obligation.