factual

Do the Bens Soft Pretzels sublease and sublicense agreements contain a liquidated damages clause?

Bens_Soft_Pretzels Franchise · 2025 FDD

Answer from 2025 FDD Document

The Franchise Disclosure Document and Franchise Agreement may require franchisees to consent to termination or liquidated damages. The Commissioner has determined this to be unfair, unjust and inequitable within the intent of the North Dakota Franchise Investment Law. This requirement will not apply to North Dakota franchisees and is deemed deleted in each place it appears in the Disclosure Document and Franchise Agreement.

Source: Item 22 — CONTRACTS (FDD pages 46–47)

What This Means (2025 FDD)

Based on the 2025 Franchise Disclosure Document, the North Dakota Addendum to the Franchise Disclosure Document addresses liquidated damages. According to the addendum, any requirement in the Franchise Disclosure Document and Franchise Agreement that requires franchisees to consent to termination or liquidated damages is considered unfair, unjust, and inequitable under the North Dakota Franchise Investment Law. Therefore, this requirement does not apply to Bens Soft Pretzels franchisees in North Dakota and is deemed deleted from the Disclosure Document and Franchise Agreement.

For prospective Bens Soft Pretzels franchisees in North Dakota, this means they will not be subject to clauses requiring consent to termination or liquidated damages, offering them additional protection under state law. This addendum ensures that North Dakota franchisees are not bound by provisions that the state deems unfair or inequitable, specifically in relation to termination and liquidated damages.

It is important for potential franchisees to carefully review any state-specific addenda to understand how the standard franchise agreement may be modified to comply with local laws. Franchisees outside of North Dakota may be subject to the standard terms regarding termination and liquidated damages as outlined in the Franchise Agreement.

Disclaimer: This information is extracted from the 2025 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.