Texas Chicken - U.S. Commercial Service

Franchise Buyer/Investor Profile Form & Process
Name of Franchisor: Texas Chicken: (Cajun Operating Company DBA Church’s)
Concept description: Founded in San Antonio, Texas in 1952, Church’s Chicken® is a highly
recognized brand name in the QSR sector, and is the second largest quick service chicken
concept in the world. Church’s Chicken serves traditional Southern and Spicy Fried Chicken
with a focus on offering complete meals with large portions at low prices and is positioned
as the Value Leader in the Chicken QSR category.
As of July 2009 the Church’s Chicken system will have over 1,700 locations in 33 US States
and 22 countries, with system sales in excess of $1.3 billion. Internationally we operate as
Church’s and Texas Chicken
Key selling features of Church’s/ Texas Chicken:
1. System-wide sales exceed US$1.3 billion.
2. Church’s is America’s 2nd largest quick service Chicken restaurant chain
3. Church’s/ Texas Chicken is one of America's premier foodservice chains that operates or
franchises more than 1’700 locations in 33 states and 22 countries.
4. Established in 1952 and with a proven 55+ plus year track record
5. Church’s is a privately held by Management and FFL Partners based out of San Francisco, Ca.
6. Church’s/ Texas will open 4 new Countries this year.
Business overview:
Church’s/ Texas Chicken is America’s second largest quick service chicken restaurant chain. We were
established in 1952 and with a proven 55 plus year track record operate Church’s/ Texas is one of
America's premier foodservice chains that operates or franchises more than 1700 locations in 33 states
and 22 countries.
We recently opened our 430 th international restaurant in St. Lucia and currently expanding in St.
Vincent, Iraq and Georgia, We franchise over 100 Texas restaurants throughout the Middle East. We
have over 1000 development commitments in place for the next ten years.
Known for its Southern-style chicken, Church's also serves Southern specialties including fried okra,
coleslaw, mashed potatoes with gravy, corn on the cob, Jalapeño Cheese Bombers®, and its unique
Honey Butter Biscuits. In 2005, Church’s Chicken launched domestically an array of spicy chicken
products.
Internationally, Church’s Chicken serves a complete line of classic and spicy products, including various
sandwiches, wraps, salads, breakfast items, and combination platters and other specialty menu items
that have helped establish our enduring reputation for high quality food.
There are certain feasibility questions that are specific to each country that we enter. These mainly
revolve around importation obstacles, menu development and in-country manufacturing capabilities.
These of course would need to be assessed prior to any restaurant development activities. As a
qualified Church’s/ Texas franchise candidate, we would look to the candidate’s acumen to assess
these areas with our support and assistance.

Church’s/ Texas Chicken franchise qualification process initially requires that the candidate meet
minimum financial criteria. This is primarily based on net worth and liquidity so that we can determine
that adequate and stable capital resources exist to support the project. These criteria may vary
depending on the area (market) of interest. Certain financial documentation is required and is held in
strict confidence during the qualification process.
Target countries: Czech Republic Poland, Turkey, and Hungary.
Financial capability of candidate: The candidate should have access to the capital required to fund
restaurant development. Development commitments of a minimum 15+ restaurants per development
area are our typical territory agreement. The number of restaurants required will depend on the size
of the development territory. The minimum net worth requirement is US$5,000,000 and the minimum
liquidity requirement is 20% of applicable net worth.
Profile characteristics of candidate franchisee:
Ideally, we are searching for companies that are involved in one or more of the following
industries:
A. food service
B. hospitality (Hotel operators)
C. operator of other restaurant brands or retail concepts
D. retail chain operators
E. food manufacturing
F. existing franchisee of international food or retail franchise (contact local franchise
association for information)
G. venture capital firms
H. logistics
I. distribution
Management Experience: The prospective franchise group should have a successful business
management background and one partner who qualify as the Operating Principal.
Operating Principal: The operating principal must live in the area to be developed throughout the term
of the franchise group’s existence and must have prior fast food general management experience
relative to the number of units to be developed.
Our ideal candidates are strong operational and marketing oriented companies involved in retailing or
another service related business
4. Additional comments:
• Our primary goal is to find area developers, groups that will own and operate all units. We are
also interested in Master Franchise model unless if the group has proven success in using this
model with a recognized restaurant or Retail brand.
• Church’s/ Texas marketing, menu and restaurant design targets the 18 to 40 year old
consumer, primarily the 18 to 34 year old male customer, which is the highest end user of fast
food.
• Menu (variety of premium, large, chicken on the bone and chicken sandwiches) that compares
to the quality you would find in a Friday’s, Chili’s or Applebee’s, but for the price and
convenience of fast food.
• Marketing support that is culturally-relevant, hip and edgy to introduce and promote the
Church’s brand and targets the young, hungry Chicken enthusiast but also appeals to the family
consumer.

• Our International restaurants are seen as not your” typical” fast food restaurant. Our
contemporary restaurant design targets all types of consumer and provides a very appealing,
comfortable, atmosphere…similar to the environment you would find in a Starbucks.
• Our customer service goes beyond what you would experience in a typical fast food restaurant.
We are known internationally for our customer service model and simple operational platform.
• Flexible restaurant designs that range from free standing, in-line and food court venues.
• Strong unit economics in regards to operating cash flow (27.2% EBITDAR), 7 consecutive years
of positive same store sales growth and year over year increases in average unit volumes FY
2002 – 2008. Figures are from our Financial Performance Representations in the 2008 United
Franchise Disclosure Document.
Typical Fees and Conditions:
• Territory Development Fee: US$12,500 per restaurant. Payable upon execution of the
Franchise Agreement.
• Training Fee: No Fee is required for Training. The training of managers will be at our facilities
in the US or Europe for 12 weeks. This also includes opening support teams from Church’s/
Texas for the first two restaurants. Your territory Development fee covers the training of your
managers. The cost for you will be their travel and accommodations at the training location.
• License Fee: US$30,000 per restaurant for a 20 year license term. Secures the right to
operate a restaurant and use our trademarks for a term of 20 years. Payable upon the
execution of each restaurant’s license agreement which occurs prior to the construction phase
for each restaurant.
• Royalty: 6.0% of sales – Payable monthly as sales and royalties are reported to Cajun
operating Company.
• Advertising: 4.0% of sales – This is a minimum advertising spending requirement that is
managed locally and controlled locally by the franchisee. 1% will be payable to church’s to
Support Ad fund for all Marketing related materials. Please note that franchisees typically
contribute 6% or more of sales towards marketing and reduce their contribution as more
restaurants are developed.
The franchisee would incur the construction cost of building and equipping the restaurants. Typical
restaurant development costs range from US$200,000 for a food court operation with no seats; to
US$300,000 for an in-line location with seating. Free standing Restaurants where relevant will cost up
to 1,000,000.00 most locations we envision in Europe is in-line restaurants.
Websites:
www.Churchs.com
www.Texaschicken.com