Under what conditions do the Additional Disclosures regarding waivers and disclaimers apply to a Chicken Guy franchise agreement?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
STATE SPECIFIC ADDENDA TO THE FDD
ADDITIONAL DISCLOSURE DOCUMENT DISCLOSURES REQUIRED BY THE STATE OF CALIFORNIA
1. SECTION 31125 OF THE CALIFORNIA CORPORATIONS CODE REQUIRES US TO GIVE YOU A DISCLOSURE DOCUMENT, IN A FORM CONTAINING THE INFORMATION THAT THE COMMISSIONER MAY BY RULE OR ORDER REQUIRE, BEFORE A SOLICITATION OF A PROPOSED MATERIAL MODIFICATION OF AN EXISTING FRANCHISE.
THE CALIFORNIA FRANCHISE INVESTMENT LAW REQUIRES THAT A COPY OF ALL PROPOSED AGREEMENTS RELATING TO THE SALE OF THE FRANCHISE BE DELIVERED TOGETHER WITH THE DISCLOSURE DOCUMENT.
THE CALIFORNIA FRANCHISE INVESTMENT LAW (CORPORATIONS CODE SECTIONS 31512 AND 31512.1) STATES THAT ANY PROVISION OF A FRANCHISE AGREEMENT OR RELATED DOCUMENT REQUIRING THE FRANCHISEE TO WAIVE SPECIFIC PROVISIONS OF THE LAW IS CONTRARY TO PUBLIC POLICY AND IS VOID AND UNENFORCEABLE. THE LAW ALSO PROHIBITS A FRANCHISOR FROM DISCLAIMING OR DENYING (I) REPRESENTATIONS IT, ITS EMPLOYEES, OR ITS AGENTS MAKE TO YOU, (II) YOUR ABILITY TO RELY ON ANY REPRESENTATIONS IT MAKES TO YOU, OR (III) ANY VIOLATIONS OF THE LAW.
CHICKEN GUY'S URL ADDRESS IS WWW.CHICKENGUY.COM. OUR WEBSITE HAS NOT BEEN REVIEWED OR APPROVED BY THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION. ANY COMPLAINTS CONCERNING THE CONTENTS OF THIS WEBSITE MAY BE DIRECTED TO THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION AT WWW.DFPI.CA.GOV.
2. Item 3, Additional Disclosure. The following statement is added to Item 3:
Neither Chicken Guy nor any person listed in Item 2 is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities Exchange Act of 1934, 15 U.S.C.A. 78a et seq., suspending or expelling such parties from membership in such association or exchange.
3. Item 5, Additional Disclosure. The following statement is added to Item 5.
The Department of Financial Protection and Innovation requires Chicken Guy to provide a financial assurance for California franchisees, pursuant to which Chicken Guy has posted a surety bond in the amount of $50,000. The bond is on file with the Department of Financial Protection and Innovation.
4. Item 17, Additional Disclosures. The following statements are added to Item 17:
California Business and Professions Code Sections 20000 through 20043 provide rights to you concerning transfer, termination or non-renewal of the franchise and development agreements.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 40–46)
What This Means (2025 FDD)
According to the 2025 Chicken Guy FDD, the additional disclosures regarding waivers and disclaimers in the franchise agreement are applicable under specific state laws. These disclosures primarily aim to protect franchisees from waiving rights granted to them under state franchise laws.
Specifically, for franchisees in California, the California Franchise Investment Law states that any provision requiring a franchisee to waive specific provisions of the law is void and unenforceable. Chicken Guy is also prohibited from disclaiming or denying representations made to the franchisee, the franchisee's ability to rely on those representations, or any violations of the law.
For franchisees in Maryland, any provisions requiring a general release of claims against Chicken Guy do not release any claim under the Maryland Franchise Registration and Disclosure Law. Similarly, in Minnesota, Chicken Guy cannot require franchisees to assent to a release, assignment, novation, or waiver that would relieve any person from liability imposed by Minnesota Statutes. Illinois law also voids any provision that binds a person acquiring a franchise to waive compliance with the Illinois Franchise Disclosure Act. Finally, in Washington, any provisions in the Development Agreement that are inconsistent with the Franchise Investment Protection Act are void and unenforceable. Additionally, no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under state franchise law or disclaim reliance on statements made by Chicken Guy.