What happens if representations or promises are made outside of the Chicken Guy disclosure document and Development Agreement?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN DEVELOPMENT AGREEMENT | SUMMARY |
|---|---|---|
| a. Length of the development term | Section 1.A. | The term is from the date of execution of the Development Agreement to the date that you sign a lease or purchase the site for the last Franchised Restaurant that you are required to develop under the Development Schedule. |
| PROVISION | SECTION IN DEVELOPMENT AGREEMENT | SUMMARY |
| r. Non-competition covenants after the franchise is terminated or expires | Section 12.C. | No activity as described in q. above for one year within your Development Territory, within two miles of its border and within two miles of any then- existing Chicken Guy! Restaurant. If you violate the post-termination non-competition provisions, you must pay liquidated damages equal to our then- current Initial Franchise Fee and 8% of the Gross Sales of the competing business until the expiration of the non-competition period (subject to state law). |
| s. Modification of the | Section 20 | No modification generally without signed |
| agreement | agreement, but we may modify the System. | |
| t. Integration/merger clause | Section 20 | Only the terms of the Development Agreement are binding (subject to state law). Any representations or promises made outside this disclosure document and the Development Agreement may not be enforceable. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 40–46)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, any representations or promises made outside the disclosure document and the Development Agreement may not be enforceable, subject to state law. This means that if a potential franchisee relies on verbal promises or other assurances not written into these official documents, Chicken Guy may not be legally bound to honor them.
This provision is a standard integration or merger clause common in franchise agreements. It aims to limit the franchise relationship to the written terms, providing clarity and certainty for both parties. However, the phrase "subject to state law" is important. Certain states have franchise laws that may protect franchisees from misleading statements, even if those statements are not in the written agreement.
Prospective Chicken Guy franchisees should be aware of this clause and ensure that all important terms and conditions are included in the Development Agreement. They should also consult with a legal professional to understand their rights under the franchise laws of their specific state, as these laws may offer additional protections against unenforceable promises or misrepresentations made during the franchise sales process.