For Beef O Bradys franchisees in Illinois, what law governs the Franchise Agreement?
Beef_O_Bradys Franchise · 2025 FDDAnswer from 2025 FDD Document
ILLINOIS ADDENDUM TO FSC FRANCHISE CO., LLC FRANCHISE DISCLOSURE DOCUMENT
The following information is added to the State Cover Page of the Franchise Disclosure Document:
Financial Condition. The Franchisor's financial condition as reflected in its financial statements (see Item 21) calls into question the Franchisor's financial ability to provide services and support to you.
Item 5 of the Franchise Disclosure Document is amended by adding the following language as a new paragraph at the end:
Based upon the franchisor's financial condition, the Illinois Attorney General has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the Franchise Agreement. In addition, all development fees and initial payments by area developers shall be deferred until the first franchise under the Area Development Agreement opens.
The Franchise Disclosure Document is modified to include the following:
Illinois law governs the Franchise Agreement.
In conformance with Section 4 of the Illinois Franchise Disclosure Act, any provision in a franchise agreement that designates jurisdiction and venue in a forum outside of the State of Illinois is void. However, a franchise agreement may provide for arbitration to take place outside of Illinois.
Your rights upon Termination and Non-renewal are set forth in sections 19 and 30 of the Illinois Franchise Disclosure Act.
In conformance with section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation or provision purporting to bind any person acquiring any franchise to waiver compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
Source: Item 23 — RECEIPTS. (FDD pages 66–330)
What This Means (2025 FDD)
According to the 2025 Beef O Bradys FDD, Illinois law governs the Franchise Agreement for franchisees operating in Illinois. This is explicitly stated in the Illinois Addendum to the Franchise Disclosure Document.
Specifically, Section 4 of the Illinois Franchise Disclosure Act dictates that any provision within the franchise agreement that designates jurisdiction and venue outside of Illinois is considered void. However, the agreement can still stipulate that arbitration may occur outside of the state.
Additionally, the FDD states that the rights of the franchisee regarding termination and non-renewal are protected under sections 19 and 30 of the Illinois Franchise Disclosure Act. Furthermore, Section 41 of the same act ensures that franchisees cannot waive compliance with the Illinois Franchise Disclosure Act or any other Illinois law.