Is the Bang Cookies Franchise Disclosure Document effective in South Dakota?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
The North Dakota Addendum is only applicable if you are a resident of North Dakota or if your Bang Cookies Shop outlet will be located within the State of North Dakota.
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- Article 15 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring North Dakota franchisees to sign a general release upon renewal of the Franchise Agreement are not enforceable in North Dakota."
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- Article 16 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring North Dakota Franchisees to consent to termination or liquidated damages are not enforceable in North Dakota."
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- Articles 6 of the Franchise Agreement are hereby amended by the addition of the following language: "Covenants not to compete such as those mentioned above are generally considered unenforceable in the State of North Dakota."
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- Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Covenants requiring North Dakota franchisees to consent to the jurisdiction of courts outside of North Dakota may not be enforceable in North Dakota."
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- Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "for North Dakota Franchisees, North Dakota law shall apply."
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- Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring a franchisee to consent to a waiver of trial by jury are not enforceable under Section 51-19-09 of the North Dakota Franchise Investment Law."
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- Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring the franchisee to consent to a waiver of exemplary and punitive damages are not enforceable under Section 51-19-09 of the North Dakota Franchise Investment Law."
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- Article 18 of the Franchise Agreement is hereby amended by the addition of the following language: "Provisions requiring a franchisee to consent to a limitation of claims within one year have been determined to be unfair, unjust and inequitable within the intent of Section 51-19-09 of the North Dakota Franchise Investment Law. Therefore, for North Dakota franchisees, the statute of limitations under North Dakota Law will apply."
Each provision of this amendment shall be effective only to the extent, with respect to such provision, that the jurisdictional requirements of North Dakota Law are met independently without reference to this amendment.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
The 2024 Bang Cookies Franchise Disclosure Document (FDD) includes a North Dakota addendum, which suggests that the FDD has been reviewed and amended to comply with North Dakota franchise laws. According to the FDD, the North Dakota Addendum is applicable if you are a resident of North Dakota or if your Bang Cookies shop will be located within the State of North Dakota. The addendum modifies several articles of the standard franchise agreement to align with North Dakota law.
Specifically, the addendum addresses provisions related to general releases upon renewal, termination and liquidated damages, covenants not to compete, jurisdiction of courts, choice of law, waiver of trial by jury, waiver of exemplary and punitive damages, and limitations of claims. For example, it states that provisions requiring North Dakota franchisees to sign a general release upon renewal are not enforceable in North Dakota. Similarly, covenants requiring North Dakota franchisees to consent to the jurisdiction of courts outside of North Dakota may not be enforceable in North Dakota.
These modifications indicate that Bang Cookies has taken steps to ensure compliance with North Dakota's franchise regulations. However, there is no mention of South Dakota in the provided excerpts. A prospective franchisee should confirm with Bang Cookies whether the FDD is effective in South Dakota and if any state-specific addenda apply to franchisees in South Dakota.