If litigation is not precluded by the Cinnaholic franchise agreement, where can a franchisee bring an action?

isequestionnaires.pdf

• 1. To the extent this Addendum is inconsistent with any terms or conditions of the Agreement or the Exhibits or Schedules thereto, the terms of this Addendum shall govern.

, 20 Each of the undersigned hereby acknowledges having read, understood, and executed this Addendum on CINNAHOLIC FRANCHISING, LLC If an Individual: Print Name: Print Name: If other than an Individual: By: Name: Title:(Illinois)

The following Addendum modifies and supersedes the Cinnaholic Franchising, LLC Franchise Agreement (the "Agreement") with respect to CINNAHOLIC® franchises offered or sold to either a resident of the State of Illinois or a non-resident who will be operating a CINNAHOLIC® franchise in the State of Illinois pursuant to the Illinois Franchise Disclosure Act of 1987, Ill. Comp. Stat. §§ 705/1 through 705/44, as follows:

• 1. Illinois law governs the Franchise Agreement(s).
• 1. Payment of Initial Franchise/Development Fees will be deferred until Franchisor has met its initial obligations to franchisee, and franchisee has commenced doing business. This financial assurance requirement was imposed by the Office of the Illinois Attorney General due to Franchisor's financial condition3) In conformance with Section 4 of the Illinois Franchise Disclosure Act, any provision in a franchise agreement that designates jurisdiction and venue in a forum outside of the State of Illinois is void. However a franchise agreement may provide for arbitration to take place outside of Illinois.
• 1. Your rights upon Termination and Non-Renewal are set forth in sections 19 and 20 of the Illinois Franchise Disclosure Act.
• 1. In conformance with section 41 of the Illinois Franchise Disclosure Act, any condition, stipulation or provision purporting to bind any person acquiring any franchise to waive compliance with the Illinois Franchise Disclosure Act or any other law of Illinois is void.
• 1. No statement, questionnaire or acknowledgement 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 behalf of the Franchisor. This provision supersedes any other term of any document executed in connection with the franchise.

Each of the undersigned hereby acknowledges having read, understood, and executed this Addendum on, 20 CINNAHOLIC FRANCHISING, LLC If an Individual: Print Name: Print Name: If other than an Individual:(Maryland)

The following Addendum modifies and supersedes the Cinnaholic Franchising, LLC Franchise Agreement (the "Agreement") with respect to CINNAHOLIC® franchises offered or sold to either a resident of the State of Maryland or a non-resident who will be operating a CINNAHOLIC® franchise in the State of Maryland pursuant to the Maryland Franchise Registration and Disclosure Law, Md. Code Bus. Reg. §§ 14- 201 through 14-233, as follows:

1. The first sentence of Section 4 of the Franchise Agreement is deleted in its entirety and replaced with the following:

Based upon the franchisor's financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the franchise agreement. In addition, all development fees and initial payments by area developers shall be deferred until the first franchise under the development agreement opens.

• 1. The general release language required as a condition of renewal, sale and/or assignment or transfer shall apply except for claims arising under the Maryland Franchise Registration and Disclosure Law.
• 1. Under certain circumstances, the Agreement requires Franchisee to submit to a court proceeding in the State where Franchisor's principal executive office is located. These provisions may run contrary to the Maryland Franchise Registration and Disclosure Law. Therefore, nothing will preclude Franchisee from being able to enter into litigation with Franchisor in Maryland.
• 1. Any claims arising under the Maryland Franchisor Registration and Disclosure Law must be brought within three years after the grant of the franchise.

Source: Item 22 — CONTRACTS (FDD pages 61–62)