What does the Maryland addendum state regarding the enforceability of Apricot Lane's franchise agreement termination upon bankruptcy under federal bankruptcy law?

According to the 2025 Apricot Lane FDD, the Maryland addendum addresses the enforceability of franchise agreement termination upon the franchisee's bankruptcy. Specifically, it states that any clause in the franchise agreement allowing for automatic termination due to the franchisee's bankruptcy is not enforceable under federal bankruptcy law. This addendum is crucial for prospective franchisees in Maryland as it clarifies their rights and protections under both state franchise law and federal bankruptcy law.

This provision means that if an Apricot Lane franchisee in Maryland files for bankruptcy, Apricot Lane cannot automatically terminate the franchise agreement solely based on the bankruptcy filing. Federal bankruptcy law takes precedence, preventing the franchisor from using bankruptcy as an immediate cause for termination. This protection allows the franchisee an opportunity to reorganize their finances and potentially continue operating the franchise.

It is important for potential Apricot Lane franchisees in Maryland to understand this addendum in conjunction with the full franchise agreement. While the franchisor cannot automatically terminate the agreement due to bankruptcy, other clauses and conditions within the agreement may still apply during bankruptcy proceedings. Franchisees should seek legal counsel to fully understand their rights and obligations in such situations.