Besides the amendments in the addendum, how will the Alloy Area Development Agreement be construed and enforced?

According to Alloy's 2025 Franchise Disclosure Document, the Area Development Agreement will be construed and enforced in accordance with its original terms, except for the specific amendments outlined in the addenda. This general statement appears in addenda for several states, including South Dakota, Virginia, and California. These addenda address specific compliance issues related to state statutes and regulations.

For example, the South Dakota addendum addresses financial assurances required by the South Dakota Securities Regulation Office due to Alloy's financial condition, deferring development fees and initial payments until the first facility opens. The Virginia addendum mandates the deferral of initial franchise fees and other initial payments until Alloy completes its pre-opening obligations. The Virginia addendum also notes that any default or termination grounds in the agreement that do not constitute "reasonable cause" under Virginia law may not be enforceable.

Similarly, the California addendum states that the California Franchise Relations Act provides franchisees with rights regarding termination, transfer, or non-renewal, and the law will take precedence if the agreement is inconsistent. In essence, while the original terms of the Area Development Agreement generally hold, franchisees must be aware of and understand the specific modifications and legal protections provided by the addenda applicable to their state.