Under what circumstances is the Maryland Addendum to the Bens Soft Pretzels Franchise Agreement executed?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
- 1. The provisions of this Addendum form an integral part of, and are incorporated into the Franchise Agreement. This Addendum is being executed because: (a) the offer or sale of the franchise to Franchisee was made in the State of Maryland; (b) Franchisee is a resident of the State of Maryland; and/or (c) the Franchised Business will be located or operated in the State of Maryland.
- 2. All representations requiring prospective franchisees to assent to a release, estoppel or waiver of liability are not intended to nor shall they act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
- 3. The following sentence is added to the end of Sections 4.B and 11.D:
The general release required as a condition of renewal or transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
4. The following sentence is added to the end of Section 9.A:
Based upon the franchisor's financial condition, the Maryland Securities Commissioner 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 and the outlet is opened.
5. The following sentence is added to the end of Section 15.I:
Franchisee may sue in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, provided that the Franchise Agreement may provide for arbitration in a forum outside of Maryland. Section 14-227(e) of the Maryland Franchise Registration and Disclosure Law requires that any claims arising under that Law be brought within 3 years after the grant of the franchise.
Source: Item 22 — CONTRACTS (FDD pages 46–47)
What This Means (2025 FDD)
According to the 2025 Bens Soft Pretzels Franchise Disclosure Document, the Maryland Addendum is executed under specific conditions related to the franchisee or the franchise location. The addendum is an integral part of the Franchise Agreement and is incorporated into it.
The Maryland Addendum is executed when (a) the offer or sale of the franchise to the Franchisee was made in the State of Maryland, (b) the Franchisee is a resident of the State of Maryland, and/or (c) the Franchised Business will be located or operated in the State of Maryland. This ensures that the franchisee's rights are protected under Maryland law.
Furthermore, the addendum clarifies that any representations requiring the franchisee to release, waive, or be estopped from liability do not act as such regarding liability under the Maryland Franchise Registration and Disclosure Law. It also adds a sentence to Sections 4.B and 11.D, stating that the general release required for renewal or transfer does not apply to any liability under the Maryland Franchise Registration and Disclosure Law. Additionally, Section 9.A is supplemented to indicate that initial fees and payments are deferred until Bens Soft Pretzels completes its pre-opening obligations and the outlet is opened, due to the franchisor's financial condition as required by the Maryland Securities Commissioner. Finally, the addendum specifies that the franchisee can sue in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law, with a 3-year claim window, although arbitration may occur outside of Maryland.