factual

What is the purpose of the Rider to the 1 800 Packouts Franchise Agreement?

1_800_Packouts Franchise · 2025 FDD

Answer from 2025 FDD Document

franchisees shall be deferred until the franchisor completes its pre-opening obligations under the franchise agreement and the outlet is opened.

IN WITNESS WHEREOF, the parties have executed and delivered this Rider effective on the Agreement Date.

Short-term lease cost 133,893 200,074
Total $559,807 $606,205

RIDER TO THE 1-800-Packouts Holdco, LLC FRANCHISE AGREEMENT FOR USE IN MINNESOTA

This Rider (the "Rider") is made and entered into as of the Agreement Date as stated in the Franchise Agreement (defined below), between you, __________________________________________, as Franchisee, and us, 1-800-Packouts Holdco, LLC, a Georgia limited liability company, as Franchisor.

    1. Background. We and you are parties to that certain Franchise Agreement effective as of _______________________ (the "Franchise Agreement") that has been signed concurrently with the signing of this Rider. This Rider is annexed to and forms part of the Franchise Agreement. This Rider is being signed because (a) the Franchised Business that you will operate under the Franchise Agreement will be located in Minnesota; and/or (b) any of the offering or sales activity relating to the Franchise Agreement occurred in Minnesota.
    1. Releases. The following is added to the end of Sections 2.D(4) and 14.C(6) of the Franchise Agreement:

Any release required as a condition of renewal and/or assignment/transfer will not apply to the extent prohibited by the Minnesota Franchises Law.

  1. Renewal and Termination. The following is added to the end of Sections 2.D and 15.B of the Franchise Agreement:

However, with respect to franchises governed by Minnesota law, we will comply with Minn. Stat. Sec. 80C.14, Subds. 3, 4 and 5 which require, except in certain specified cases, that a franchisee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice of non-renewal of this Agreement.

  1. Consent to Jurisdiction. The following is added to the end of Section 17.A of the Franchise Agreement:

However, Minn. Stat. Sec. 80C.21 and Minn. Rule 2860.4400J prohibits us, except in certain specified cases, from requiring litigation to be conducted outside Minnesota. Nothing in this Agreement shall abrogate or reduce any of your rights under Minnesota Statutes Chapter 80C or your right to any procedure, forum or remedies that the laws of the jurisdiction provide.

  1. Governing Law. The following is added to the end of Section 17.B of the Franchise Agreement:

However, nothing in this Agreement shall abrogate or reduce any of your rights under Minnesota Statutes Chapter 80C or your right to any procedure, forum or remedies that the laws of the jurisdiction provide.

  1. Limitations of Claims. The following is added to the end of Section 17.G of the Franchise Agreement:

Minnesota law provides that no action may be commenced under Minn. Stat. Sec. 80C.17 more than three (3) years after the cause of action accrues.

No statement, questionnaire, or acknowledgement 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 with the franchise.

IN WITNESS WHEREOF, the parties have executed and delivered this Rider effective on the Agreement Date.

2024 2023
Current:
Federal $(133,183) $(262,480)
State 244 (78,963)
Total current (132,939) (341,443)

RIDER TO THE 1-800-Packouts Holdco, LLC FRANCHISE AGREEMENT FOR USE IN NEW YORK

This Rider (the "Rider") is made and entered into as of the Agreement Date as stated in the Franchise Agreement (defined below), between you, __________________________________________, as Franchisee, and us, 1-800-Packouts Holdco, LLC, a Georgia limited liability company, as Franchisor.

    1. Background. We and you are parties to that certain Franchise Agreement that has been signed concurrently with the signing of this Rider (the "Franchise Agreement"). This Rider is annexed to and forms part of the Franchise Agreement. This Rider is being signed because (a) the offer or sale of the franchise for the Franchised Business that you will operate under the Franchise Agreement was made in the State of New York, and/or (b) you are a resident of New York and will operate the Franchised Business in New York.
    1. Releases. The following language is added to the end of Sections 2.D(4) and 14.C(6) of the Franchise Agreement:
    • , provided, however, that to the extent required by Article 33 of the General Business Law of the State of New York, all rights you enjoy and any causes of action arising in your favor from the provisions of Article 33 of the General Business Law of the State of New York and the regulations issued thereunder shall remain in force; it being the intent of the proviso that the non-waiver provisions of GBL 687 and 687.5 be satisfied.
    1. Transfer by Franchisor. The following language is added to the end of Section 14.A of the Franchise Agreement:

However, no assignment will be made except to an assignee who, in our good faith judgment, is willing and financially able to assume our obligations under this Agreement.

  1. Termination by Franchisee. The following language is added to the end of Section 15.A of the Franchise Agreement:

You also may terminate the Agreement on any grounds available by law.

  1. Governing Law/Consent to Jurisdiction. The following language is added to the end of Sections 17.A and 17.B of the Franchise Agreement:

However, to the extent required by Article 33 of the General Business Law of the State of New York, this Section shall not be considered a waiver of any right conferred upon you by the provisions of Article 33 of the General Business Law of the State of New York and the regulations issued thereunder.

  1. Limitation of Claims. The following language is added to the end of Section 17.G of the Franchise Agreement:

To the extent required by Article 33 of the General Business Law of the State of New York, all rights and any causes of action arising in your favor from the provisions of Article 33 of the General Business Law of the State of New York and the regulations issued thereunder shall remain in force; it being the intent of this provision that the non-waiver provisions of GBL Sections 687.4 and 687.5 be satisfied.

IN WITNESS WHEREOF, the parties have executed and delivered this Rider effective on the Agreement Date.

Federal 453,482 (292,567)
State 111,856 (131,688)
Total deferred 565,338 (424,255)
Total benefit (provision) for income taxes $432,399 $(765,698)

RIDER TO THE 1-800-Packouts Holdco, LLC FRANCHISE AGREEMENT FOR USE IN NORTH DAKOTA

This Rider (the "Rider") is made and entered into as of the Agreement Date as stated in the Franchise Agreement (defined below), between you, __________________________________________, as Franchisee, and us, 1-800-Packouts Holdco, LLC, a Georgia limited liability company, as Franchisor.

    1. Background. We and you are parties to that certain Franchise Agreement effective as of _______________________ (the "Franchise Agreement") that has been signed concurrently with the signing of this Rider. This Rider is annexed to and forms part of the Franchise Agreement. This Rider is being signed because (a) you are a resident of North Dakota and the Franchised Business that you will operate under the Franchise Agreement will be located in North Dakota; and/or (b) any of the offering or sales activity relating to the Franchise Agreement occurred in North Dakota.
    1. Releases. The following is added to the end of Sections 2.D(4) and 14.C(6) of the Franchise Agreement:

Any general release shall not apply to the extent prohibited by law with respect to claims arising under the North Dakota Franchise Investment Law.

  1. Covenant Not to Compete. The following is added to the end of Section 16.E of the Franchise Agreement:

Covenants not to compete such as those mentioned above generally are considered unenforceable in North Dakota.

Source: Item 23 — RECEIPT (FDD pages 67–238)

What This Means (2025 FDD)

According to the 2025 1 800 Packouts Franchise Disclosure Document, the purpose of the Rider to the Franchise Agreement is to address specific legal requirements and considerations for franchisees operating in certain states. These Riders are designed to modify the standard Franchise Agreement to ensure compliance with state franchise laws. The FDD includes sample Riders for Minnesota, Washington, Maryland, New York, North Dakota, and Rhode Island.

For example, the Rider for Minnesota addresses issues such as releases, renewal, and termination, ensuring compliance with Minn. Stat. Sec. 80C.14, Subds. 3, 4 and 5, which mandates specific notice periods for termination and non-renewal. Similarly, the Rider for Washington acknowledges the Washington Franchise Investment Protection Act and clarifies that its provisions will prevail in case of conflicting laws. The Maryland Rider modifies the Franchise Agreement regarding releases, consent to jurisdiction, and governing law, specifically concerning claims arising under the Maryland Franchise Registration and Disclosure Law.

The Riders for New York, North Dakota, and Rhode Island also address state-specific legal considerations. The New York Rider focuses on non-waiver provisions of the General Business Law, while the North Dakota Rider addresses the enforceability of covenants not to compete and consent to jurisdiction. The Rhode Island Rider modifies the agreement concerning consent to jurisdiction and governing law to align with the Rhode Island Franchise Investment Act.

For a prospective 1 800 Packouts franchisee, it's crucial to understand whether a Rider applies to their specific situation based on their state of residence or where their franchised business will be located. Franchisees should carefully review the Rider in conjunction with the Franchise Agreement to fully understand their rights and obligations under the franchise agreement, as modified by state law.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.