What is the significance of the Franchisee being domiciled in Maryland or the Crisp & Green Franchised Restaurant being located in Maryland, according to this addendum?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
HISE AGREEMENT FOR THE STATE OF ILLINOIS
This Addendum pertains to franchises sold in the State of Illinois and is for the purpose of complying with Illinois statutes and regulations. This Addendum shall be of no force and effect unless the jurisdictional requirements of the Illinois Franchise laws and any regulations thereunder are met independently without reference to this Addendum.
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- BACKGROUND. Franchisor and Franchisee are parties to that certain Franchise Agreement dated _______ (the "Agreement"), that has been entered into concurrently with the entering of this Addendum. This Addendum is annexed to and forms part of the Agreement, and the defined terms set forth in the Agreement are used in this Addendum with the same meanings ascribed to them in the body of the Agreement. This Addendum is being executed because the Franchised Restaurant to be operated by Franchisee pursuant to the Agreement will be located in the State of Minnesota and/or because Franchisee is a resident of the State of Minnesota.
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- AMENDMENTS. Notwithstanding anything which may be contained in the body of the Agreement to the contrary, the Agreement is amended as follows:
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- FORUM FOR LITIGATION. The following sentence is added to the end of Section 18.07 ("Jurisdiction and Venue") of the Franchise Agreement:
Section 4 of the Illinois Franchise Disclosure Act provides that any provision in a franchise agreement which designates jurisdiction or venue in a forum outside of Illinois is void.
- GOVERNING LAW. Section 18.08 of the Franchise Agreement is deleted and replaced with the following:
Illinois law shall govern this Agreement.
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- ILLINOIS FRANCHISE DISCLOSURE ACT. The following language is added as Section 18.21 of the Franchise Agreement:
- 18.21 Illinois Franchise Disclosure Act.
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
According to Crisp & Green's 2024 Franchise Disclosure Document, if a franchisee is domiciled in Maryland or the Crisp & Green restaurant is located in Maryland, the franchise agreement is subject to specific amendments to comply with the Maryland Franchise Registration and Disclosure Law.
Specifically, any release required as a condition of renewal, sale, or transfer will not apply to claims arising under the Maryland Franchise Registration and Disclosure Law. This means that franchisees in Maryland retain their rights to pursue claims under Maryland franchise law, even if they sign a general release. Additionally, while the standard franchise agreement requires litigation to occur where Crisp & Green's principal executive office is located, Maryland franchisees can bring actions in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law. However, these claims must be brought within three years after the grant of the franchise.
Furthermore, the addendum clarifies that the standard franchise agreement's termination clause related to bankruptcy may not be fully enforceable under federal bankruptcy law. Finally, the Maryland Franchise Registration and Disclosure Law will govern any claim arising under that law, superseding the standard governing law clause in the franchise agreement to the extent of any conflict.