Does the Buildingstars franchise agreement require the franchisee to warrant they are not affiliated with any individual or entity engaged in terrorist activity?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
- C. Under applicable U.S. Law, including without limitation executive order 1224, signed on September 23, 2001 (the "Order"), FRANCHISEE is prohibited from engaging in any transaction with any person engaged in, or with a person aiding any person engaged in acts of terrorism as defined in the Order. Accordingly, FRANCHISEE does not and hereafter will not engage in any terrorist activity. In addition, FRANCHISEE is not affiliated with and does not support any individual or entity engaged in, contemplating, or supporting terrorist activity. Finally, FRANCHISEE is not acquiring the rights granted under this Agreement with the intent to generate funds to channel to any individual or entity engaged in, contemplating, or supporting terrorist activity, or to otherwise support or further any terrorist activity.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the franchise agreement includes a clause where the franchisee makes certain warranties related to terrorism. Specifically, the franchisee must warrant that they do not and will not engage in any terrorist activity, and that they are not affiliated with or supporting any individual or entity involved in terrorist activity. Furthermore, the franchisee must warrant that they are not acquiring the franchise rights with the intention of using the funds to support any terrorist activity. This requirement is based on U.S. Law, including Executive Order 1224 signed on September 23, 2001.
This clause in the Buildingstars franchise agreement is a legal safeguard for the franchisor, ensuring compliance with U.S. laws and regulations related to terrorism. It also protects the Buildingstars brand and reputation by preventing association with individuals or entities involved in illegal activities.
For a prospective Buildingstars franchisee, this means they must be prepared to sign a franchise agreement that includes these warranties. Falsely representing this information could have significant legal consequences, including potential termination of the franchise agreement and legal penalties. It is a standard practice for franchise agreements to include clauses that ensure compliance with applicable laws and protect the franchisor's interests.