What is the geographic limit of the Virginia Addendum's applicability to the Crown Gold Exchange Disclosure Document?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
VIRGINIA ADDENDUM TO DISCLOSURE DOCUMENT
In the Commonwealth of Virginia only, this Disclosure Document is amended as follows: The following statements are added to Item 17(h):
Under Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to cancel a franchise without reasonable cause. If any grounds for default or termination stated in the Franchise Agreement do not constitute "reasonable
cause," as that term may be defined in the Virginia Retail Franchising Act or the laws of Virginia, that provision may not be enforceable.
Under Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to use undue influence to induce a franchisee to surrender any right given to him under the franchise. If any provision of the Franchise Agreement involves the use of undue influence by the franchisor to induce a franchisee to surrender any rights given to the franchisee under the franchise, that provision may not be enforceable.
Item 17(t) is amended to read as follows:
Only the terms of the Franchise Agreement and other related written agreements are binding (subject to applicable state law). Any representations or promises outside of the Disclosure Document and Franchise Agreement may not be enforceable.
Source: Item 23 — RECEIPTS (FDD pages 39–114)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, the Virginia Addendum applies specifically and exclusively within the Commonwealth of Virginia. This means that the modifications and additions outlined in the addendum to Item 17(h) of the disclosure document are only relevant to franchise agreements and operations within Virginia.
Specifically, the addendum addresses the enforceability of franchise cancellations, stating that any grounds for default or termination in the Franchise Agreement that do not constitute "reasonable cause" as defined by Virginia law may not be enforceable. It also addresses the use of undue influence by Crown Gold Exchange to induce a franchisee to surrender any rights, stating that such provisions may not be enforceable. Furthermore, the addendum clarifies that only the terms of the Franchise Agreement and other related written agreements are binding, subject to applicable state law, meaning any representations or promises outside of these documents may not be enforceable in Virginia.
For a prospective Crown Gold Exchange franchisee in Virginia, this addendum provides additional protection under the Virginia Retail Franchising Act. It ensures that terminations must be for reasonable cause, protects franchisees from undue influence, and clarifies which agreements are legally binding. Franchisees operating outside of Virginia would not receive these specific protections, as the addendum explicitly limits its scope to the Commonwealth of Virginia.