Are promises outside the Franchise Agreement enforceable for Golden Krust Caribbean Restaurant?
Golden_Krust_Caribbean_Restaurant Franchise · 2024 FDDAnswer from 2024 FDD Document
| PROVISION | SECTION IN FRANCHISE | SUMMARY | |
|---|---|---|---|
| AGREEMENT | |||
| (q) Non-competition | Section VII | No controlling ownership interest in, or | |
| covenants during the | perform services for, competitive business | ||
| term of the franchise | anywhere. | ||
| (r) Non-competition covenants after the franchise is terminated or expires | Section XVI.D. | No interest in competing business for 2 years at, or within 10 miles of premises of Restaurant or within 5 miles of any other Golden Krust Restaurant that is in operation or under construction (same restrictions apply after assignment) | |
| (s) Modification of the agreement | Section XVIII.G. | No modifications generally but Brand Standards Manual and System Standards are subject to change. | |
| (t) Integration/Merger clause | Section XVIII.H. | Only the terms of the Franchise Agreement (including the Brand Standards Manual) are binding. Any other promises may not be enforceable. Nothing in the Franchise Agreement or in any related agreement is intended to disclaim our representations made in the Franchise Disclosure Document |
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 29–32)
What This Means (2024 FDD)
According to Golden Krust Caribbean Restaurant's 2024 Franchise Disclosure Document, only the terms within the Franchise Agreement, including the Brand Standards Manual, are considered binding. This is due to an integration/merger clause in the agreement.
The integration/merger clause means that any promises or representations made outside of the Franchise Agreement may not be enforceable. However, the FDD states that this clause does not disclaim representations made in the Franchise Disclosure Document itself.
This clause is a standard provision in franchise agreements. Prospective Golden Krust Caribbean Restaurant franchisees should ensure that all material terms and conditions are included in the written Franchise Agreement to avoid relying on verbal promises or other representations that may not be legally binding.