| This Addendum is to a BAGELS Area Development Agreement dated BAB Systems, Inc. and | , 20 between (Franchisee) to amend said Agreement as follows: | |-------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | 1. | Paragraph 12.B. of the BAGELS Area Development Agreement on Transfer by Developer shall be | | amended by the addition of the following language to the original language that appears therein: | | | 687.5 be satisfied." | "All rights enjoyed by the Franchisee and any causes of action arising in its favor from the provisions of Article 33 of the General Business law of the State of New York and the regulations issued thereunder shall remain in force; it being the intent of this proviso that the non-waiver provisions of GBL Section 687.4 and | | Agreements." | "However, Franchisor shall not assign its rights and obligations to a transferee unless in its reasonable judgment, the transferee is able to fulfill the Franchisor's obligations under its BAGELS Franchise | | 2. | Paragraph 13.E. of the BAGELS Area Development Agreement on Governing Law shall be | | amended by the addition of the following language to the original language that appears therein: | | | by the provisions of Article 33 of the General Business Law of the State of New York." | "The foregoing choice of law shall not be considered a waiver of any right conferred upon the Franchisee | | understands and consents to be bound by all of its terms, and agrees it shall become effective this | IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read this Addendum, | | , 20 | day of | | Franchisor: | Developer: | | BAB SYSTEMS, INC. | Corporate/LLC Signature: | | an Illinois corporation | a corporation/LLC | | By: | By: | | | | | Title: Date Accepted: | Title: Date Accepted: Individual Signatures: | | | | | | | The Franchisor represents that this offering prospectus does not knowingly omit any material fact or contain any untrue statement of a material fact.

EXHIBIT R BAB SYSTEMS, INC. ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT FOR THE STATE OF NORTH DAKOTA

The BAB Systems, Inc. Franchise Disclosure Document for use in the State of North Dakota is modified in accordance with the following:

• 1. Item 17, c. of the Franchise Disclosure Document on "Requirements for you to renew or extend" is amended by the addition of the following:
  • "The execution of a general release upon renewal shall be inapplicable to franchises operating under the North Dakota Franchise Investment Law."
• 1. Item 17, i. of the Franchise Disclosure Document on "Franchisee's obligations on termination/ nonrenewal" is amended by the addition of the following:
  • "The liquidated damages provisions in Section 17.g. of the Franchise Agreement (Liquidated Damages) shall not apply in the State of North Dakota."
• 1. Item 17, r.

Source: Item 23 — RECEIPTS (FDD pages 87–319)