Is the choice of law for the Dog Haus franchise agreement subject to the Area Development Agreement?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section In Area Development Agreement (Exhibit B) | Summary |
|---|---|---|
| n. Franchisor's right of first | Section 9.3 | We may match any offer to purchase your business. |
| refusal to acquire Area | ||
| Developer's business | ||
| o. Franchisor's option to purchase Area Developer's business | 9.1 | We may sell our assets, the Dog Haus Marks or the Dog Haus System, may sell securities in a public offering or in a private placement, may merge, acquire other corporations, or be acquired by another corporation, and may undertake a refinancing, recapitalization, leveraged buy-out, or other economic or financial restructuring (each a "Capital Event") all without your consent or approval by you. Upon the occurrence of a Capital Event, we have the right to compel you to sell to us the assets of all your Dog Haus Restaurants, whether or not they are open or under construction. |
| p. Death or disability of Area Developer | Section 9.5 | Your spouse, heirs or personal representative has 180 days to purchase your interest or complete an assignment of your interest to a qualified, approved third party, subject to the transfer provisions. |
| q. Non-competition covenants during the term of the franchise | Section 13.2 | You are prohibited from: (i) diverting any present or prospective Dog Haus customer to any competitor, or performing any other act injurious or prejudicial to the goodwill associated with the Dog Haus Marks and the Dog Haus System; or (ii) owning or having any interest in a "Competitive Business" with Dog Haus Restaurants. A "Competitive Business" is defined as any restaurant business that prepares, offers and sells gourmet hot dogs, sausages, hamburgers, chicken, plant-based food products or any combination of these products as primary menu items and any business that looks like, copies, imitates, or operates with similar trade dress or décor to Dog Haus Restaurants. (subject to state law) |
| r. Non-competition covenants after the franchise is terminated or expires | Section 13.3 | For 2 years following the expiration or termination of your Area Development Agreement, you cannot own or have any interest in a competitive business within 2 miles of any location designated as a "Franchised Location" in a Franchise Agreement between you and us, or at any location within a 2 mile radius of any Dog Haus Restaurant or a Franchised Location. (subject to state law) |
| s. Modification of the Area Development Agreement | Section 18.5 | The Area Development Agreement can be modified or amended only by written agreement of all of the parties. |
| t. Integration/merger clause | Section 18.5 | Only the terms of the Area Development Agreement and its exhibits are binding (subject to applicable state law). No other representations or promises will be binding. Any representations or promises outside of the Disclosure Document and Area Development Agreement may not be enforceable. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 63–72)
What This Means (2025 FDD)
Based on the 2025 Dog Haus Franchise Disclosure Document, the modification of the Area Development Agreement is subject to a written agreement by all parties. The integration/merger clause specifies that only the terms of the Area Development Agreement and its exhibits are binding, subject to applicable state law. This means that no other representations or promises outside of these documents are binding, and any such representations may not be enforceable.
For a prospective Dog Haus franchisee, this indicates that any modifications to the Area Development Agreement must be formally documented and agreed upon in writing by all parties involved. This protects both the franchisor and franchisee by ensuring that all agreed-upon terms are legally binding and enforceable. It also highlights the importance of carefully reviewing the Area Development Agreement and its exhibits, as these are the only documents that will be considered legally binding.
Furthermore, the integration/merger clause serves as a warning to potential franchisees to rely solely on the written terms of the Area Development Agreement and not on any verbal promises or representations made outside of the official documents. This clause aims to prevent misunderstandings or disputes that may arise from relying on undocumented agreements. Franchisees should ensure that all important terms and conditions are included in the written agreement to avoid potential issues in the future.