Is the Better Blend Franchise Disclosure Document required to be registered in North Dakota?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
The following states have franchise laws that require that the Franchise Disclosure Document be registered or filed with the states, or be exempt from registration: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin.
This document is effective and may be used in the following states, where the document is filed, registered, or exempt from registration, as of the Effective Date stated below:
Source: Item 23 — RECEIPTS (FDD pages 43–157)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, North Dakota is one of the states that has franchise laws requiring the Franchise Disclosure Document to be registered or filed with the state, or be exempt from registration. This means that Better Blend must register or file its FDD in North Dakota, or qualify for an exemption, before offering or selling franchises there.
Furthermore, the FDD includes a specific addendum for North Dakota franchisees. This addendum lists several provisions that the Securities Commissioner has deemed unfair, unjust, or inequitable under North Dakota law. These provisions relate to restrictive covenants, the location of arbitration proceedings, restrictions on legal forums, liquidated damages and termination penalties, applicable laws, waivers of jury trials and damages, general releases, limitations of claims, and the enforcement of agreements.
For a prospective Better Blend franchisee in North Dakota, this means that certain terms in the standard franchise agreement may not be enforceable in North Dakota. The North Dakota addendum modifies the standard agreement to comply with North Dakota law, providing additional protections to franchisees in that state. It is important for potential franchisees to carefully review the North Dakota addendum and understand how it alters the standard franchise agreement.