What is the effect of the California Addendum on provisions in the Kitchen Solvers Franchise Agreement that are inconsistent with the Addendum's terms?
Kitchen_Solvers Franchise · 2025 FDDAnswer from 2025 FDD Document
ADDENDUM TO KITCHEN SOLVERS® AREA DEVELOPMENT AGREEMENT FOR THE STATE OF CALIFORNIA
To the extent the California Franchise Investment Law, Cal. Corp. Code §§ 31000-31516 or the California Franchise Relations Act, Cal. Bus. & Prof. Code §§20000-20043 applies, the terms of this Addendum apply.
- Notwithstanding anything to the contrary contained in the Area Development Agreement, to the extent that the Area Development Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
The Area Development Agreement requires developer to execute a general release of claims upon renewal or transfer of the Area Development Agreement. California Corporations Code Section 31512 provides that any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with any provision of that law or any rule or order there under is void. Section 31512 voids a waiver of your rights under the Franchise Investment Law (California Corporations Code Section 20010 voids a waiver of your rights under the Franchise Relations Act (Business and Professions Code Sections 20000 – 20043).
The Area Development Agreement requires application of the laws of Wisconsin. This provision may not be enforceable under California law.
California Business and Professions Code Sections 20000 through 20043 provide rights to the franchisee concerning termination or non-renewal of a franchise. The Federal Bankruptcy Code also provides rights to franchisee concerning termination of the Franchise Agreement upon certain bankruptcy-related events. If the Area Development Agreement is inconsistent with the law, the law will control.
The Area Development Agreement requires binding arbitration. The arbitration will occur in Wisconsin. Prospective franchisees are encouraged to consult with private legal counsel to determine the applicability of California and federal laws (such as Business and Professions Code Section 20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions of a franchise agreement restricting venue to a forum outside the State of California.
The Area Development Agreement contains a covenant not to compete which extends beyond the termination of the franchise. This provision may not be enforceable under California law.
Source: Item 23 — Receipts (FDD pages 49–190)
What This Means (2025 FDD)
According to Kitchen Solvers' 2025 Franchise Disclosure Document, the California Addendum takes precedence over any conflicting terms in the Area Development Agreement. Specifically, the addendum states that if any provision in the Area Development Agreement is inconsistent with the California Franchise Investment Law or the California Franchise Relations Act, the terms of the addendum will be applied instead. This ensures that Kitchen Solvers' franchise operations in California comply with California law.
Several specific examples of potential conflicts are addressed in the addendum. For instance, the Area Development Agreement might require a developer to execute a general release of claims upon renewal or transfer; however, California law voids any condition that waives compliance with the Franchise Investment Law or the Franchise Relations Act. Similarly, while the Area Development Agreement might specify that Wisconsin laws apply, this may not be enforceable under California law. The addendum also notes that a covenant not to compete extending beyond the termination of the franchise may not be enforceable in California.
Furthermore, the California Addendum addresses the issue of binding arbitration, noting that while the Area Development Agreement may require arbitration to occur in Wisconsin, prospective franchisees are encouraged to seek legal counsel to determine the applicability of California and federal laws regarding venue restrictions. These stipulations collectively modify the original Area Development Agreement to align with California's franchise-specific legal requirements. This ensures that Kitchen Solvers franchisees in California are afforded the full protection of California law, regardless of what the standard Area Development Agreement might state.