factual

What is the purpose of the Maryland Addendum to the Auntie Annes Disclosure Document?

Auntie_Annes Franchise · 2024 FDD

Answer from 2024 FDD Document

e terms of Item 12 of the Disclosure Document and Section 4 (Reserved Rights) of the Franchise Agreement (as applicable), we will not compete unfairly with you within a reasonable area.

    1. Notwithstanding the terms of Section 13.1 (Indemnification) of the Franchise Agreement, you will not be required to indemnify the Affiliated Parties for any liability caused by your proper reliance on or use of procedures or materials provided by us or caused by our negligence.
    1. Section 15.4.B. (Restrictive Covenants: Post Term) of the Franchise Agreement is revised to limit the geographical extent of the post-term covenant not to compete to an area of reasonable size, for all franchises sold in the State of Indiana.
    1. The prohibition by Indiana Code § 23-2-2.7-1(7) against unilateral termination of the franchise without good cause or in bad faith, good cause being defined therein as ". . . a material breach of the franchise agreement . . . ," supersede any contrary provisions contained in Section 17 (Default and Termination) of the Franchise Agreement in the State of Indiana.
    1. The provisions of the Franchise Agreement relieving both parties from liability for punitive damages will not apply to franchises offered and sold in the State of Indiana.

MARYLAND ADDENDUM TO DISCLOSURE DOCUMENT

In recognition of the requirements of the Maryland Franchise Registration and Disclosure Law, the Disclosure Document for Auntie Anne's Franchisor SPV LLC for use in the State of Maryland is amended as follows:

ITEM 17 RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION:

    1. No release language required on renewal, transfer, or signing the Franchise Agreement will relieve us or any other person, directly or indirectly, from liability imposed by the Maryland Franchise Registration and Disclosure Law.
    1. No provision of the Disclosure Document or Franchise Agreement will be construed as a release, estoppel, or waiver by you of any liability we incur under the Maryland Franchise Registration and Disclosure Law.
    1. Item 17.v. of this Disclosure Document is modified as follows:
    • You can enter into litigation with us in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, as long as the nature of the litigation is not the type of dispute, controversy, claim, action or proceeding which would be subject to arbitration under the Franchise Agreement.
    1. Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within three years after the grant of the franchise.

MINNESOTA ADDENDUM TO DISCLOSURE DOCUMENT

In recognition of the requirements of the Minnesota Franchises Law, Minn. Stat. §§ 80C.01 through 80C.22, and of the Rules and Regulations promulgated thereunder by the Minnesota Commissioner of Commerce, Minn. Rules §§ 2860.0100 through 2860.9930, the Disclosure Document for Auntie Anne's Franchisor SPV LLC for the offer of franchises for use in the State of Minnesota is amended to include the following:

  1. Item 6, "Other Fees," shall be amended as follows:

We may be limited in the amount of the Insufficient Funds Fee we may charge you as described in Item 6 of this Disclosure Document. The Minnesota Department of Commerce requires us to disclose to you that, currently, the highest such fee permitted under Minnesota Statute 604.113 is $30.

2.

Source: Item 22 — CONTRACTS (FDD page 106)

What This Means (2024 FDD)

According to Auntie Annes' 2024 Franchise Disclosure Document, the Maryland Addendum modifies the disclosure document to comply with the Maryland Franchise Registration and Disclosure Law. This ensures that Auntie Annes franchises offered in Maryland adhere to specific state regulations.

The addendum specifically addresses Item 17, which concerns renewal, termination, transfer, and dispute resolution. It clarifies that no release language in any agreement will relieve Auntie Annes from liabilities imposed by Maryland law. Furthermore, no part of the disclosure or franchise agreement can be interpreted as a waiver of Auntie Annes' liability under the Maryland Franchise Registration and Disclosure Law.

The addendum also modifies Item 17 regarding litigation. Franchisees can pursue litigation against Auntie Annes in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, provided the dispute isn't subject to arbitration under the Franchise Agreement. Any claims under this law must be initiated within three years of the franchise grant. These stipulations protect the franchisee's rights under Maryland law and ensure a fair legal process within the state.

Finally, the FDD states that if the franchise is to be operated in Maryland, the franchisee should not sign the acknowledgement. This acknowledgement is to determine whether any unauthorized or untrue statements were made to the franchisee. It also confirms that the franchisee has been properly represented and understands the limitations on claims related to the franchise. The franchisee cannot sign this acknowledgement on the same day as the receipt for the Franchise Disclosure Document, but must sign it the same day as the Franchise Agreement and payment of the franchise fee.

Disclaimer: This information is extracted from the 2024 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.