Under what circumstances is the Rider to the Bft Multi-Unit Agreement signed?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
IN WITNESS WHEREOF, the parties have executed and delivered this Rider to be effective as of the effective date of the Multi-Unit Agreement.
BFT FRANCHISE SPV, LLC, a Delaware limited liability company [NAME OF DEVELOPER] Capacity:
RIDER TO THE BFT FRANCHISE SPV, LLC MULTI-UNIT AGREEMENT FOR USE IN MARYLAND
| THIS RIDER (this "Rider") is made and entered into by and between BFT FRANCHISE SPV, |
|---|
| LLC, a Delaware limited liability company with its principal business address at 17877 Von Karman Ave., |
| Suite 100 Irvine, CA 92614 ("Franchisor"), and, |
| whose principal business address is |
| ("Developer"). |
| 1. |
| Background. Franchisor and Developer are parties to that certain Multi-Unit Agreement |
| dated |
| , 20 (the "Multi-Unit Agreement") that has been signed concurrently |
| with the signing of this Rider. This Rider supersedes any inconsistent or conflicting provisions of the Multi |
| Unit Agreement. Terms not otherwise defined in this Rider have the meanings as defined in the Multi-Unit |
| Agreement. |
| This Rider is annexed to and forms part of the Multi-Unit Agreement. This Rider is being |
| signed because (a) Developer is a resident of the State of Maryland; or |
| (b) the Studios that Developer |
| develops under the |
| Multi-Unit Agreement |
| are or will be developed |
| in the State of Maryland; or |
| (c) the offer |
| to sell is made in the State of Maryland; or |
| (d) the offer to buy is accepted in the State of Maryland. |
| 2. |
| Insolvency. |
| The following is added to the end of Section 8.A.(1)(b) (Termination of |
| Franchise by Franchisor) |
| of the Multi-Unit Agreement: |
| The provision which provides for termination upon Developer's |
| bankruptcy might not be |
| enforceable under federal bankruptcy law |
| (11 U.S.C. Sections 101 et seq.). |
| 3. |
| Release. The following is added to the end of Section 9.B |
| (Transfer of Interest - |
| By |
| Developer and its Owners) |
| of the Multi-Unit Agreement: |
| Pursuant to COMAR 02.02.08.16L, any release required as a condition of renewal and/or |
| assignment/transfer will not apply to claims arising under the Maryland Franchise |
| Registration and Disclosure Law. |
| 4. |
| Governing Law; Consent to Jurisdiction. The following is added to the end of Sections 12.A |
| (Governing Law) |
| and 12.F (Consent to Jurisdiction) |
| of the Multi-Unit Agreement: |
| ; provided, however, Developer |
| may bring a lawsuit in Maryland for claims arising under |
| the Maryland Franchise Registration and Disclosure Law. Maryland law may apply to |
| claims arising under the Maryland Franchise Registration and Disclosure Law. |
| 5. |
| Mediation; Mandatory Binding Arbitration. The following is added to the end of Sections |
| 12.C (Mediation) |
| and 12.D |
| (Mandatory Binding Arbitration) |
| of the Multi-Unit Agreement: |
enforceable.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the Rider to the Multi-Unit Agreement is signed concurrently with the Multi-Unit Agreement itself. This rider is designed to address specific legal considerations and requirements that vary from state to state. It supersedes any conflicting information in the original Multi-Unit Agreement, ensuring compliance with local laws. The Rider is annexed to and forms a part of the Multi-Unit Agreement.
The circumstances necessitating the Rider depend on the state where the developer (franchisee) is located or where the franchise activities occur. For instance, if the developer is a resident of Maryland, if the studios developed under the agreement are or will be developed in Maryland, or if the offer to sell or buy the franchise is made or accepted in Maryland, the Rider is required. Similarly, a Rider is required for developers domiciled in North Dakota or if the offer to sell is made in North Dakota, or if the studios are or will be operated in North Dakota. In Minnesota, the Rider is required if the studios will be developed in Minnesota or if any offering or sales activity related to the agreement occurred in Minnesota. In New York, the Rider is required if an offer to sell or buy is made in New York, or if the developer is domiciled in New York and the studio is or will be developed there. Finally, in Washington, the Rider is required if the offer is directed into the state and received there, if the developer is a resident of Washington, or if the studios are or will be located or operated in Washington.
These state-specific Riders modify certain provisions of the Multi-Unit Agreement to align with local franchise laws. For example, the Maryland Rider clarifies that release requirements do not apply to claims arising under Maryland franchise law. The Illinois Rider references the Illinois Franchise Disclosure Act, noting that waivers of compliance with Illinois law are void and that developer's rights upon termination are subject to specific sections of the Act. The Washington Rider ensures that the agreement does not waive any liability Bft may have under the Washington Investment Protection Act. These Riders ensure that Bft's franchise agreements comply with the specific legal requirements of each state, providing additional protections and disclosures to franchisees where required by law.
Prospective Bft franchisees should carefully review the Rider applicable to their state to understand how the Multi-Unit Agreement is modified to comply with local laws. This includes understanding their rights and obligations under state franchise laws, as well as any specific disclosures or protections provided by the Rider. Franchisees should also be aware that the Rider takes precedence over any conflicting provisions in the standard Multi-Unit Agreement, making it a critical document for understanding the full scope of their franchise relationship with Bft.