What is the name of the agreement that Churchs Chicken may offer that provides limited territorial exclusivity?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
outlets that we own, or from other channels of distribution or competitive brands that we control.
We may offer an amendment to the Development Agreement that provides limited territorial exclusivity ("Exclusive Development Agreement"), as negotiated between us based on your capabilities and our market development objectives.
The Development Agreement grants you the right and obligation to develop an agreed-on number of Restaurants in your Development Area according to an agreed-on Development Schedule. The Development Agreement does not grant you any options, rights of first refusal, or similar rights to acquire additional franchises inside or outside your Development Area. The size of the Development Area will vary considerably and is subject to our mutual agreement before the Development Agreement is signed. Factors that may affect the size of a Development Area include your wishes, the expansion capacity of the area contemplated, the competition in the area and your prior experience and financial capacity.
If you sign an Exclusive Development Agreement, you will be granted a geographic area within which we will not open a Restaurant, nor license anyone other than you to open a Restaurant, subject to the other terms of the Agreement. The exclusive development area does not include airports, train stations, bus stations, travel plazas, stadiums, arenas, convention centers, military facilities, schools, colleges, universities, hospitals, recreational theme parks, business or industrial foodservice venues, food courts, enclosed shopping malls and retail centers, venues in which foodservice is or may be provided by a master concessionaire or contract foodservice provider, Indian reservations, casinos or any similar captive market location, even if these locations are located in the Development Area.
Source: Item 12 — TERRITORY (FDD pages 43–45)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the company may offer an amendment to the Development Agreement that provides limited territorial exclusivity, called the "Exclusive Development Agreement." This agreement is negotiated between Churchs Chicken and the franchisee based on the franchisee's capabilities and Churchs Chicken's market development objectives.
Under the Exclusive Development Agreement, Churchs Chicken grants the franchisee a geographic area where it will not open a Restaurant or license anyone else to do so, subject to the agreement's terms. However, this exclusivity does not extend to locations such as airports, train stations, travel plazas, stadiums, convention centers, military facilities, schools, colleges, universities, hospitals, recreational theme parks, business or industrial foodservice venues, food courts, enclosed shopping malls and retail centers, venues in which foodservice is or may be provided by a master concessionaire or contract foodservice provider, Indian reservations, casinos or any similar captive market location, even if these locations are within the Development Area.
It's important to note that territorial exclusivity under the Exclusive Development Agreement is not contingent on achieving a certain sales volume or market penetration. However, the franchisee must comply with all terms of the agreement, including the obligation to open and maintain an agreed-upon number of Restaurants according to the Development Schedule. Failure to comply with the Development Schedule may result in Churchs Chicken terminating the Development Agreement or, if applicable, terminating the franchisee's limited territorial exclusivity.