Under what circumstances does Section 16.10 of the Body20 Franchise Agreement allow a person to waive compliance with the Illinois Franchise Disclosure Act?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
reement will be located in Illinois, and/or (b) you are domiciled in Illinois.
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- GOVERNING LAW. Section 16.1 of the Franchise Agreement is deleted and replaced with the following:
Except to the extent governed by the Federal Arbitration Act or other federal law, Illinois law governs this Agreement.
- CONSENT TO JURISDICTION. The following is added to the end of Section 16.3(d) of the Franchise Agreement:
Notwithstanding the foregoing, in conformance with Section 4 of the Illinois Franchise Disclosure Act, any provision in this Agreement that designates jurisdiction and venue in a forum outside of Illinois is void. However, this Agreement may provide for arbitration to take place outside of Illinois.
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Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, Section 16.10 of the Franchise Agreement addresses the Illinois Franchise Disclosure Act. It states that any condition, stipulation, or provision that attempts to bind someone acquiring a Body20 franchise to waive compliance with any part of the Illinois Franchise Disclosure Act or any other Illinois law is considered void. This means Body20 cannot enforce any agreement where a franchisee gives up their rights under Illinois franchise law. This protection is also reiterated in additional disclosures for Illinois.
However, Section 16.10 includes an exception. It specifies that this prohibition does not prevent a person from entering into a settlement agreement or executing a general release regarding a potential or actual lawsuit filed under any provision of the Act. In other words, if a franchisee has a dispute with Body20 and decides to settle that dispute, they can sign a settlement agreement that includes a release of claims, even if those claims arise under the Illinois Franchise Disclosure Act. This also does not prevent the arbitration of any claim pursuant to the provisions of Title 9 of the United States Code.
In practical terms, this means that while Body20 franchisees cannot be forced to waive their rights under the Illinois Franchise Disclosure Act upfront, they can choose to do so later if they enter into a settlement agreement or agree to arbitration to resolve a dispute. This is a fairly standard provision in franchise agreements, as it allows parties to resolve conflicts without necessarily resorting to litigation, while still protecting franchisees' initial rights.