For Chocolate Bash, what is the effective date status of the Franchise Disclosure Document in California?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
oid. The provisions of Article 17 (Dispute Resolution) and Article 18 (Miscellaneous) of the Franchise Agreement apply to and are incorporated into this MUDA as if fully set forth herein.
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| FRANCHISOR:CHOCOLATE BASH FRANCHISING, LLC | |
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EXHIBIT E
STATE ADDENDA TO DISCLOSURE DOCUMENT
CALIFORNIA ADDENDUM TO DISCLOSURE DOCUMENT
California Corporations Code, Section 31125 requires the franchisor to give the franchisee a disclosure document, approved by the Department Of Financial Protection and Innovation, prior to 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 OFFERING CIRCULAR.
OUR WEBSITE HAS NOT BEEN REVIEWED OR APPROVED BY THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION. ANY COMPLAINTS CONCERNING THE CONTENT OF THIS WEBSITE MAY BE DIRECTED TO THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION AT www.dfpi.ca.gov.
THESE FRANCHISES HAVE BEEN REGISTERED UNDER THE FRANCHISE INVESTMENT LAW OF THE STATE OF CALIFORNIA. SUCH REGISTRATION DOES NOT CONSTITUTE APPROVAL, RECOMMENDATION OR ENDORSEMENT BY THE COMMISSIONER OF BUSINESS OVERSIGHT NOR A FINDING BY THE COMMISSIONER THAT THE INFORMATION PROVIDED HEREIN IS TRUE, COMPLETE AND NOT MISLEADING.
Both the Governing Law and Choice of Law for Franchisees operating outlets located in California, will be the California Franchise Relations Act regardless of the choice of law or dispute resolution venue state elsewhere. Any language in the franchise agreement or amendment to or any agreement to the contrary is superseded by this condition.
The franchise agreement contains a covenant not to compete which extends beyond the termination of the franchise. A contract that restrains a former franchisee from engaging in a lawful trade or business is to that extent void under California Business and Professions Code Section 16600.
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
1.
Source: Item 23 — RECEIPTS (FDD pages 39–101)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, the franchise is registered under the Franchise Investment Law of the State of California. However, the registration does not mean that the Commissioner of Business Oversight approves, recommends, or endorses the franchise. Nor does it mean that the Commissioner has found the information provided by Chocolate Bash to be true, complete, and not misleading.
Furthermore, California Corporations Code requires Chocolate Bash to provide a disclosure document approved by the Department Of Financial Protection and Innovation before any solicitation of a proposed material modification of an existing franchise. The FDD also states that 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 offering circular.
Additionally, the Department has determined that Chocolate Bash has not demonstrated that they are adequately capitalized and/or that they must rely on franchise fees to fund their operations. The Commissioner has imposed a fee deferral condition, which requires that Chocolate Bash defers the collection of all initial fees from California franchisees until they have completed all of their pre-opening obligations and the franchisee is open for business. For California franchisees who sign a development agreement, the payment of the development and initial fees attributable to a specific unit in the development schedule is deferred until that unit is open.
Finally, the Chocolate Bash FDD includes a California Addendum to Disclosure Document as Exhibit E.