Are there any exceptions to California law governing the Beard Papas Franchise Agreement?
Beard_Papas Franchise · 2025 FDDAnswer from 2025 FDD Document
| r. | Non-competition covenants after the franchise is terminated or expires | 6, 17.E. | No involvement, ownership, or interest whatsoever for 24 months in any competing business in: your Designated Territory; a 25-mile radius of your Designated Territory; a 10-mile radius of the Designated Territory of any other Shop; and you must comply with confidentiality, non disclosure and non-solicitation covenants. |
|---|---|---|---|
| s. | Modification of the agreement | 18.L. | Requires writing signed by you and us, except for unilateral |
| changes that we may make to the Manuals or our unilateral | |||
| reduction of the scope of a restrictive covenant that we may | |||
| make in our discretion. | |||
| t. | Integration/merger clauses | 18.M. | Only the terms of the Franchise Agreement and schedules to |
| the Franchise Agreement and the respective signed exhibits | |||
| to the Franchise Agreement are binding, subject to state | |||
| law. Nothing in any agreement is intended to disclaim the | |||
| express representations | |||
| made in the Franchise Disclosure | |||
| Document, its exhibits, | |||
| and amendments. | |||
| u. | Dispute resolution by arbitration or mediation | 18.G. | Except for certain claims for injunctive relief, all disputes must first be submitted to non-binding mediation in Los Angeles County, California and, if mediation is unsuccessful, then to binding arbitration in Los Angeles County, California. This provision is subject to applicable state law. |
| v. | Choice of forum | 18.G. | All mediation, arbitration and, if applicable, litigation |
| proceedings must be conducted in, or closest to, state court | |||
| of general jurisdiction that is within or closest to Los | |||
| Angeles County, California | |||
| or, if appropriate, the United | |||
| States District Court nearest to our corporate headquarters | |||
| at the time such action is filed. This provision is subject to | |||
| applicable state law. | |||
| w. | Choice of law | 18.F. | California |
| law will govern. However, this provision is | |||
| subject to state law and as otherwise disclosed in Exhibit I | |||
| to this Disclosure Document. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–51)
What This Means (2025 FDD)
According to Beard Papas's 2025 Franchise Disclosure Document, several provisions within the franchise agreement are subject to applicable state law, indicating potential exceptions to California law. Specifically, the sections regarding integration/merger clauses, dispute resolution, choice of forum, and choice of law are all noted as being 'subject to state law.' This means that while California law generally governs the agreement, certain aspects might be modified or superseded by other relevant state laws. Additionally, the choice of law provision is subject to what is disclosed in Exhibit I of the Disclosure Document, suggesting further specific exceptions may be detailed elsewhere.
For a prospective Beard Papas franchisee, this means that the application of certain clauses in the franchise agreement may vary depending on the specific state laws in effect. For example, the way disputes are resolved (through mediation or arbitration) and where these proceedings take place could be influenced by state regulations. The integration/merger clause, which defines the scope of the agreement, is also subject to state law, potentially affecting what terms are considered binding.
It is important for potential franchisees to carefully review Exhibit I of the FDD and consult with a legal professional to understand how these state law exceptions might impact their rights and obligations under the Beard Papas Franchise Agreement. This due diligence will help ensure they are fully aware of any deviations from standard California law and how those deviations could affect their franchise operations.