Under what circumstances is the Addendum mentioned in this section signed for a Brightstar Care franchise?

e") is entered into simultaneously with the execution of the Franchise Agreement. | |

• 1. The provisions of this Addendum form an integral part of and are incorporated into the Franchise Agreement. This addendum is being signed because: (a) the offer or sale of the franchise to Franchisee was made in the State of Minnesota; (b) Franchisee is a resident of the State of Minnesota; and/or (c) the BrightStar Care Agency will be located or operated in the State of Minnesota.
  • 1. The following sentence is added to the end of Sections 1.5 and 13:

With respect to franchises governed by Minnesota law, Franchisor will comply with Minnesota Statute § 80C.14, subdivision 3, 4, and 5 which requires, except in certain cases, that Franchisee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the Franchise Agreement.

1. The following sentence is added to the end of Sections 2.2, 12.4.9, and 12.7:

Notwithstanding the foregoing, Franchisee will not be required to assent to a release, assignment, novation, or waiver that would relieve any person from liability imposed by Minnesota Statute §§ 80C.01 – 80C.22.

1. The following sentences are added to the end of Sections 15.3 and 15.8:

Minnesota Statute § 80C.21 and Minnesota Rule 2860.4400J prohibit Franchisor from requiring arbitration or litigation to be conducted outside Minnesota. In addition, nothing in the Disclosure Document or the Franchise Agreement can abrogate or reduce any of Licensee's rights as provided for in Minnesota Statutes, Chapter 80C, or Franchisee's rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction.

• 1. Any capitalized terms that are not defined in this Addendum shall have the meaning given them in the Franchise Agreement.
• 1. Except as expressly modified by this Addendum, the Franchise Agreement remains unmodified and in full force and effect.

BrightStar Franchising, LLC

ADDITIONAL DISCLOSURE DOCUMENT DISCLOSURES REQUIRED BY THE STATE OF NEW YORK

1. The following information is added to the cover page of the Franchise Disclosure Document:

INFORMATION COMPARING FRANCHISORS IS AVAILABLE. CALL THE STATE ADMINISTRATORS LISTED IN EXHIBIT A OR YOUR PUBLIC LIBRARY FOR RESOURCES OR INFORMATION. REGISTRATION OF THIS FRANCHISE BY NEW YORK STATE DOES NOT MEAN THAT NEW YORK STATE RECOMMENDS IT OR HAS VERIFIED THE INFORMATION IN THIS FRANCHISE DISCLOSURE DOCUMENT. IF YOU LEARN ANYTHING IN THIS FRANCHISE DISCLOSURE DOCUMENT IS UNTRUE, CONTACT THE FEDERAL TRADE COMMISSION AND THE APPROPRIATE STATE OR PROVINCIAL AUTHORITY.

THE FRANCHISOR MAY, IF IT CHOOSES, NEGOTIATE WITH YOU ABOUT ITEMS COVERED IN THE FRANCHISE DISCLOSURE DOCUMENT. HOWEVER, THE FRANCHISOR CANNOT USE THE NEGOTIATING PROCESS TO PREVAIL UPON A PROSPECTIVE FRANCHISEE TO ACCEPT TERMS THAT ARE LESS FAVORABLE THAN THOSE SET FORTH IN THIS FRANCHISE DISCLOSURE DOCUMENT.

1. The following language is added to the end of Item 3 of the Franchise Disclosure Document:

Except as provided above, the following applies to the franchisor, its predecessor, a person identified in Item 2, or an affiliate offering franchises under the franchisor's principal trademark:

• A. No such party has an administrative, criminal or civil action pending against that person alleging: a felony, a violation of a franchise, antitrust or securities law, fraud, embezzlement, fraudulent conversion, misappropriation of property, unfair or deceptive practices, or comparable civil or misdemeanor allegations.
• B. No such party has pending actions, other than routine litigation incidental to the business, that are significant in the context of the number of franchisees and the size, nature or financial condition of the franchise system or its business operations.
• C. No such party has been convicted of a felony or pleaded nolo contendere to a felony charge or, within the 10-years immediately preceding the application for registration, has been convicted of or pleaded nolo contendere to a misdemeanor charge or has been the subject of a civil action alleging: violation of a franchise, antifraud, or securities law; fraud;

• embezzlement; fraudulent conversion or misappropriation of property; or unfair or deceptive practices or comparable allegations.
• D. No such party is subject to a currently effective injunctive or restrictive order or decree relating to the franchise, or under a Federal, State, or Canadian franchise, securities, antitrust, trade regulation or trade practice law, resulting from a concluded or pending action or proceeding brought by a public agency; or is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities and Exchange Act of 1934, suspending or expelling such person from membership in such association or exchange; or is subject to a currently effective injunctive or restrictive order relating to any other business activity as a result of an action brought by a public agency or department, including, without limitation, actions affecting a license as a real estate broker or sales agent.
• 1. The following is added to the end of Item 5 of the Franchise Disclosure Document: The initial franchise fee constitutes part of our general operating funds and will be used as such in our discretion.
• 1. The following language is added to the end of the "Summary" sections of Item 17(c), titled Requirements for a franchisee to renew or extend, and Item 17(m), titled Conditions for franchisor approval of transfer:

However, to the extent required by applicable law, all rights you enjoy and any causes of action arising in your 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; this proviso intends that the non-waiver provisions of General Business Law Sections 687(4) and 687(5) be satisfied.

1. The following language replaces the "Summary" section of Item 17(d) of the Franchise Disclosure Document, titled Termination by franchisee:

You may terminate the agreement on any grounds available by law.

1. The following language is added to the end of the "Summary" sections of Item 17(v), titled Choice of forum, and Item 17(w), titled Choice of law:

The foregoing choice of law should not be considered a waiver of any right conferred upon the franchisor or upon the franchisee by Article 33 of the General Business Law of the State of New York.

1. Franchise Questionnaires and Acknowledgements. No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement

made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.

1. Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship.

ADDENDUM TO THE FRANCHISE AGREEMENT REQUIRED FOR NEW YORK FRANCHISEES

• 1. The provisions of this Addendum form an integral part of and are incorporated into the Franchise Agreement. This Addendum is being signed because: (a) the offer or sale of the franchise to Franchisee was made in the State of New York; (b) Franchisee is a resident of the State of New York; and/or (c) the BrightStar Care Agency will be located or operated in the State of New York.
• 1. Any provision in the Franchise Agreement that is inconsistent with the New York General Business Law, Article 33, Section 680 - 695 may not be enforceable.
  • 1. The following sentence is added to the end of Sections 2.2, 12.4.9, and 12.7:

Any provision in the Franchise Agreement requiring Franchisee to sign a general release of claims against Franchisor does not release any claim Franchisee may have under New York General Business Law, Article 33, Sections 680-695.

1. The following language is added as Section 6.18 of the Franchise Agreement:

Franchisee's responsibilities under New York Law are in no way lessened by entering into the Franchise Agreement. Notwithstanding any provision to the contrary in the Franchise Agreement, Franchisee retains:

• (i) ongoing responsibility and full legal authority over the operation and management of the Agency;
• (ii) ongoing responsibility for compliance with all statutory and regulatory requirements;
  • (iii) authority to hire or fire Agency staff;
  • (iv) control of the Agency's books and records;
• (v) authority over the disposition of assets and the authority to incur liabilities on behalf of the Agency.

By entering into the Franchise Agreement, Franchisee has agreed to adopt and utilize the policies and procedures Franchisor has developed. Notwithstanding the foregoing, Franchisee retains the right and authority to adopt, amend, enforce, and implement policies and procedures regarding the operation of the Agency in order to ensure compliance with applicable licensing or permitting requirements.

1. The following sentence is added at the end of Section 12.1:

Franchisor will not assign its rights under the Franchise Agreement except to an assignee who in Franchisor's good faith and judgment is willing and able to assume Franchisor's obligations under the Franchise Agreement.

1. The following sentence is added to the end of Section 22:

Notwithstanding the foregoing, the New York Franchises Law shall govern any claim arising under that law.

1. The following language is added as Section 29 of the Franchise Agreement:

The Franchise Agreement approved by the New York State Commissioner of Health will be the sole Franchise Agreement between Franchisor and Franchisee during the initial term, relating to the operation of the Agency in the geographic area that is covered by the Franchise Agreement.

• 1. Any capitalized terms that are not defined in this Addendum shall have the meaning given them in the Franchise Agreement.
• 1. Except as expressly modified by this Addendum, the Franchise Agreement remains unmodified and in full force and effect full force and effect.

BrightStar Franchising, LLC

SUPPLEMENTAL ADDENDUM TO THE FRANCHISE AGREEMENT REQUIRED FOR NEW YORK LHCSA FRANCHISEES

The following statements are added to the Franchise Agreement and supersede any inconsistent provisions appearing thereunder:

• 1. Franchisee's responsibilities under New York Law are in no way lessened by entering into the Franchise Agreement. Notwithstanding any provision to the contrary in the Franchise Agreement, Franchisee retains:
  • (i) ongoing responsibility and full legal authority over the operation and management of the agency;
  • (ii) ongoing responsibility for compliance with all statutory and regulatory requirements;
  • (iii) authority to hire or fire agency staff;

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 81–92)