What is the significance of the Rider to the Clear Pest Pros Franchise Agreement?
Clear_Pest_Pros Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
Background. We and you are parties to that certain Franchise Agreement that has been executed concurrently with the execution of this Rider (the "Franchise Agreement"). This Rider is annexed to and forms part of the Agreement.
This Rider is being executed because (a) the offer or sale of the franchise for the Clear Pest Pros franchise you will operate under the Agreement was made in the State of Minnesota and you will operate the Franchise in the State of Minnesota and/or (b) you are a resident of the State of Minnesota.
Minnesota Rules 2860.4400(G) prohibits a franchisor from imposing on a franchisee by contract or rule, whether written or oral, any standard of conduct that is unreasonable.
Marks. The following language is added at the end of Section 4 of the Agreement:
Pursuant to Minnesota Stat. Sec. 80C.12, Subd. 1(g), we are required to protect any rights that you have to use our proprietary rights, including your right to use the trademarks, service marks, trade names, logotypes or other commercial symbols and indemnify the franchisee from any loss, costs, or expenses arising out of any claim, suite or demand regarding the use of the name.
Termination by Franchisor. The following language is added to Section 12.B of the Agreement:
With respect to franchises governed by Minnesota law, the franchisor will comply with Minn. Stat. Sec. 80C.14, Subds. 3, 4, and 5 which require, except in certain specified cases, that a franchisee be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice of non-renewal of the franchise agreement and that consent to the transfer of the franchise will not be unreasonably withheld. The franchisor will comply with Minnesota law in this respect in its performance of the franchise agreement and any ancillary agreements.
Waiver of Punitive Damages and Jury Trial. The following is added to Section 15.I, of the Agreement:
Minn. Rule 2860.4400J. prohibits the waiver of a jury trial.
Limitations of Claims. The Limitations of Claims section must comply with Minnesota Stat. § 80C.17, subd. 5.
[Item 22: CONTRACTS]
ADDENDUM TO THE FRANCHISE AGREEMENT FOR USE IN MARYLAND
The parties to this Rider are FRANCHISOR and FRANCH
Source: Item 22 — CONTRACTS (FDD pages 67–68)
What This Means (2025 FDD)
According to the 2025 Clear Pest Pros Franchise Disclosure Document, a Rider to the Franchise Agreement is an addendum that modifies the standard agreement to comply with specific state laws or address specific circumstances. These Riders are crucial because they tailor the franchise agreement to the legal requirements of the state where the franchise is offered or operated, or where the franchisee resides. This ensures that the Clear Pest Pros franchise agreement adheres to local regulations, which can vary significantly from state to state. Item 22 of the FDD discusses contracts and includes several examples of addenda for different states.
For instance, the Rider for Minnesota addresses issues such as the franchisor's duty to protect the franchisee's right to use proprietary rights, termination notice requirements, and prohibitions against waiving jury trials. Similarly, the Rider for Maryland includes provisions related to the expiration of the agreement, enforcement of claims, dispute resolution procedures, and acknowledgments, all in accordance with Maryland franchise laws. The Rider for North Dakota modifies sections of the franchise agreement related to agreements and releases, covenants not to compete, governing law, dispute resolution procedures, and waivers of damages and jury trials, aligning them with North Dakota's Franchise Investment Law.
These Riders are annexed to and form part of the main Franchise Agreement, indicating their legal importance. Prospective Clear Pest Pros franchisees should carefully review any Rider attached to their Franchise Agreement to understand their rights and obligations under the laws of their specific state. The presence and content of a Rider can significantly impact the franchisee's operational flexibility, legal protections, and dispute resolution options. It is advisable to seek legal counsel to fully comprehend the implications of any Rider before signing the Franchise Agreement.