Does the restriction against owning a competitive restaurant business apply to other restaurants franchised by Chicken Guy or its affiliates?

According to Chicken Guy's 2025 Franchise Disclosure Document, the restriction against owning a competitive restaurant business does not apply to other restaurants operated by the franchisee that are franchised by Chicken Guy or its affiliates. This means a franchisee can own and operate other restaurant businesses franchised by Chicken Guy or its affiliates without violating the non-compete clause.

This exception to the non-compete agreement could be beneficial for franchisees looking to diversify their business interests within the Chicken Guy franchise system. It allows them to expand their portfolio without being penalized for owning competing businesses. However, it's important to note that this exception only applies to restaurants franchised by Chicken Guy or its affiliates. Any other restaurant business that features chicken as a primary menu item (at least 20% of sales) or has a similar method of operation or trade dress to Chicken Guy would still be subject to the non-compete restrictions.

During the Development Term, there is no geographical limitation on the non-compete restriction. After the Development Term expires or terminates, the restriction applies within the Development Territory, within 2 miles of the border of the Development Territory, and within 2 miles of any existing Chicken Guy restaurant, unless Chicken Guy approves otherwise in writing. Franchisees should carefully consider these geographical limitations when planning any additional restaurant ventures.

It is also important to note that this exception does not apply to the franchisee's existing restaurant or foodservice operations, if any, which are identified in the attached Data Sheet. Franchisees should review their Data Sheet to understand how their existing businesses are treated under the agreement.