In Minnesota, can Best Brains require franchisees to consent to termination penalties?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
MINNESOTA ADDENDUM TO THE FRANCHISE AGREEMENT
If any of the terms of the Franchise Agreement are inconsistent with the terms below, the terms below control.
- Minn. Stat. §80C.21 and Minn. Rule 2860.4400(J) prohibit the franchisor from requiring litigation to be conducted outside Minnesota, requiring waiver of a jury trial, or requiring the franchisee to consent to liquidated damages, termination penalties or judgment notes. In addition, nothing in the Franchise Disclosure Document or agreements can abrogate or reduce (1) any of the franchisee's rights as provided for in Minnesota Statutes, Chapter 80C, or (2) franchisee's rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, if you are opening a Best Brains franchise in Minnesota, Best Brains is prohibited from requiring you to consent to termination penalties.
The Minnesota Addendum to the Franchise Agreement states that Minnesota Statute §80C.21 and Minnesota Rule 2860.4400(J) explicitly prohibit Best Brains from requiring franchisees to consent to liquidated damages, termination penalties, or judgment notes. This protects franchisees from potentially unfair financial burdens if the franchise agreement is terminated.
This provision ensures that Minnesota franchisees are not forced into agreeing to penalties that could be detrimental to their financial well-being upon termination. It also ensures franchisees maintain all rights and remedies as provided by Minnesota law.