Besides operating other Churchs Chicken restaurants, what other businesses or activities is a Churchs Chicken franchisee prohibited from engaging in?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Accordingly, Franchisee covenants and agrees that during the Initial Term and any Renewal Term, Franchisee shall not, either directly or indirectly, for itself or through, on behalf of, or in conjunction with any person or entity:
- (a) divert or attempt to divert any business or customer, or potential business or customer, of any restaurant franchised or operated by Cajun or its affiliates to any competitor by direct or indirect inducement or otherwise or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Proprietary Marks or the System or;
- (b) have an ownership interest in any restaurant business (other than a Church's Restaurant) that specializes in the sale of fried chicken.
- (3) Franchisee further covenants that following the transfer, expiration or earlier termination of this Agreement, regardless of the cause for termination, Franchisee shall not, either directly or indirectly, for itself or through, on behalf of, or in conjunction with any person or entity:
- (a) for a period of 2 years, have an ownership interest in any restaurant business (other than a Church's Restaurant) that specializes in the sale of fried chicken and that is (i) located at or within a 5-mile radius of the Franchised Location, or (ii) located within a 5-mile radius of any Church's Restaurant that is then in existence or under development.
Source: Item 23 — RECEIPT (FDD pages 68–406)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, a franchisee is restricted from certain business activities both during the term of the franchise agreement and for a period after the agreement concludes. During the Initial Term and any Renewal Term, a Churchs Chicken franchisee is prohibited from having an ownership interest in any restaurant business (other than a Church's Restaurant) that specializes in the sale of fried chicken. Additionally, franchisees cannot divert or attempt to divert any business or customer of any restaurant franchised or operated by Churchs Chicken to any competitor. They are also prohibited from performing any act injurious or prejudicial to the goodwill associated with Churchs Chicken's Proprietary Marks or the System.
Post-termination, for a period of 2 years, the franchisee is restricted from having an ownership interest in any restaurant business (other than a Church's Restaurant) that specializes in the sale of fried chicken. This restriction applies if the restaurant is located at or within a 5-mile radius of the Franchised Location, or within a 5-mile radius of any Church's Restaurant that is then in existence or under development.
These restrictions are designed to protect Churchs Chicken's market share, brand reputation, and trade secrets. The non-compete clauses ensure that franchisees do not directly compete with Churchs Chicken, either during the franchise term or for a limited period afterward, within a specific geographic area. Prospective franchisees should carefully consider these limitations and how they might impact their future business endeavors.