If the Churchs Chicken Development Agreement is terminated, does Cajun retain the Development Fee?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
- B. In addition to the Development Fee required by Section 4, Developer shall pay Cajun an initial franchise fee ("Initial Franchise Fee") for each Franchised Restaurant to be developed under this Agreement in the amount set forth in Schedule 2. The Initial Franchise Fee is payable upon execution of the Franchise Agreement for each Franchised Restaurant. Developer acknowledges and agrees that the Initial Franchise Fee is fully earned by Cajun when paid, and it is not refundable.
Source: Item 23 — RECEIPT (FDD pages 68–406)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the initial franchise fee paid by the developer is not refundable. Specifically, the FDD states that the developer shall pay Cajun an initial franchise fee for each franchised restaurant to be developed under the agreement. This fee is payable upon the execution of the franchise agreement for each restaurant.
The document explicitly states that the initial franchise fee is fully earned by Cajun when paid and is not refundable. This means that regardless of whether the Development Agreement is terminated, or for any other reason, the developer will not receive a refund of the initial franchise fee.
This policy has significant implications for prospective Churchs Chicken developers. It highlights the importance of carefully evaluating the development schedule and the likelihood of fulfilling the development obligations before entering into the agreement and paying the initial franchise fee. Developers should be aware that this fee is non-refundable, even if they are unable to open the planned restaurants or if the agreement is terminated.