What is the relationship between the Illinois Rider and the main Crab N Spice Franchise Agreement?
Crab_N_Spice Franchise · 2024 FDDAnswer from 2024 FDD Document
| This Rider amends the Agreement "Agreement"), between Crab N Spice Group, a California corporation ("CNS Franchising") and , a ("Franchisee"). | dated (the |
|---|---|
| 1. | |
| Definitions. | |
| Capitalized terms used but not defined in this Rider have the meanings given | |
| in the Agreement. | |
| The "Illinois Act" means the Illinois Franchise Disclosure Act of 1987. | |
| 2. | |
| Governing Law and Jurisdiction. Notwithstanding any provision of the Agreement to | |
| the contrary, the Agreement is governed by Illinois law. The parties irrevocably submit to the | |
| jurisdiction and venue of the federal and state courts in Illinois, except for matters which the | |
| Agreement provides will be resolved by arbitration. | |
| 3. | aware of |
| Limitation of Claims. No action can be maintained to enforce any liability created by the | |
| Illinois Act unless brought before the expiration of 3 years from the act or transaction constituting | |
| the violation upon which it is based, the expiration of 1 year after Franchisee become | |
| facts or circumstances reasonably indicating that Franchisee may have a claim for relief in respect | |
| to conduct governed by the Illinois Act, or 90 days after delivery to the Franchisee of a written | |
| notice disclosing the violation, whichever shall first expire. | |
| 4. | |
| Waivers Void. Notwithstanding any provision of the Agreement to the contrary, any | |
| condition, stipulation, or provision purporting to bind Franchisee to waive compliance with any | |
| provision of the Illinois Act or any other law of the State of Illinois is void. This Section shall not | |
| prevent Franchisee from entering into a settlement agreement or executing a general release | |
| regarding a potential or actual lawsuit filed under any of the provisions of this Act, nor shall it | |
| prevent the arbitration of any claim pursuant to the provisions of Title 9 of the United States Code. | |
| 5. | |
| Fee Deferral. | |
| Payment of Initial and Development Fees will be deferred until the | |
| franchisor has met its initial obligations to franchisee, and franchisee has commenced business | |
| operations. This financial assurance requirement was imposed by the Office of the Illinois | |
| Attorney general due to franchisor's financial condition. | |
| 6. | |
| Acknowledgements. No statement, questionnaire or acknowledgement signed or agreed | |
| to y 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. | |
| 7. | |
| Effective Date. | |
| This Rider is effective as of the Effective Date. | |
| Agreed to by: | |
| FRANCHISEE: | |
| FRANCHISOR: |
Source: Item 22 — CONTRACTS (FDD pages 50–51)
What This Means (2024 FDD)
According to Crab N Spice's 2024 Franchise Disclosure Document, the Illinois Rider amends the main Franchise Agreement. The rider includes several provisions specific to Illinois law and the relationship between the franchisee and Crab N Spice.
Specifically, the Illinois Rider states that the Franchise Agreement is governed by Illinois law, regardless of any conflicting provisions in the main agreement. It also dictates that any action to enforce liability under the Illinois Franchise Disclosure Act must be brought within a specific timeframe: three years from the act constituting the violation, one year after the franchisee becomes aware of potential claims, or 90 days after receiving written notice of the violation, whichever expires first. The rider also stipulates that any attempt to waive compliance with Illinois law is void, although settlement agreements and arbitrations are permitted.
Furthermore, the Illinois Rider addresses fee deferral, stating that the payment of initial and development fees will be deferred until Crab N Spice has met its initial obligations and the franchisee has commenced business operations. This requirement was imposed by the Illinois Attorney General due to Crab N Spice's financial condition. The rider also clarifies that acknowledgements signed by the franchisee cannot waive claims under state franchise law or disclaim reliance on the franchisor. The Illinois Rider is effective as of the Effective Date of the Franchise Agreement.