Is there a specific format required for the 'ACKNOWLEDGEMENT OF PRINCIPAL' section in the Alloy franchise agreement?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
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- The Acknowledgment Addendum attached to the Area Development Agreement (and specifically stating that it is not for use in the State of Illinois) is unenforceable under Illinois law because it may have the effect of forcing a franchisee to waive or release certain rights that you as a franchisee have under the Illinois Franchise Disclosure Act, 815 IL § 705.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
Based on the 2025 Alloy Franchise Disclosure Document excerpts, there is no mention of a specific format required for the 'ACKNOWLEDGEMENT OF PRINCIPAL' section within the franchise agreement, with one exception. For franchises sold in Illinois, the 'Acknowledgement Addendum' attached to the Area Development Agreement is unenforceable under Illinois law because it may force a franchisee to waive rights under the Illinois Franchise Disclosure Act.
However, the Illinois addendum indicates that the Acknowledgment Addendum specifically states that it is not for use in the State of Illinois. This suggests that there is a standard Acknowledgment Addendum that Alloy uses, but it is not enforceable in Illinois.
Therefore, prospective Alloy franchisees should review the franchise agreement and any associated addenda carefully, paying particular attention to any acknowledgement sections. It would be prudent to consult with a legal professional to ensure full understanding of their rights and obligations, especially in light of the Illinois-specific clause.