How does the Rhode Island Addendum affect the Even Hotels Franchise Disclosure Document?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
et seq.), paragraphs 11.C(1)(b) and (d) of the License shall be amended to include the following language: "Enforceability of this provision is a matter governed by the U.S. Bankruptcy Code and enforceability or nonenforceability is subject to that law and rulings of a court of competent jurisdiction."
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- Any provision in the License which designates jurisdiction or venue or requires the Licensee to agree to jurisdiction or venue, in a forum outside of North Dakota, is deleted from Licenses issued in the State of North Dakota. The site of any arbitration will be agreeable to all parties.
| thousands): | |||||
|---|---|---|---|---|---|
| 2024 | 2023 | 2022 | |||
| Operating cash flows | |||||
| Operating leases | $ 16,317 | $ 14,968 | $ 18,186 | ||
| Finance leases | 21,120 | 21,120 | 18,560 |
Amendment To The Holiday Hospitality Franchising, LLC Even Hotels License Agreement Pursuant To The Rhode Island Franchise And Distributorship Act
Notwithstanding anything to the contrary set forth in the above License Agreement ("License"), the following provisions shall supersede and apply to each License for an Even Hotel issued in the State of Rhode Island:
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- In accordance with the provision under the U.S. Bankruptcy Code (11 U.S.C.A. Sec. 101 et seq.), paragraphs 11.C(1)(b) and (d) of the License shall be amended to include the following language: "Enforceability of this provision is a matter governed by the U.S. Bankruptcy Code and enforceability or nonenforceability is subject to that law and rulings of a court of competent jurisdiction."
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- Section 19-28.14 of the Rhode Island Franchise Investment Act provides that: "A provision in a franchise agreement restricting jurisdiction or venue to a forum outside this state or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under this Act." This provision will also apply to the Guaranty.
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- Any provision in the License which designates the governing law as that of any state other than the State of Rhode Island is deleted from Licenses issued in the State of Rhode Island.
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- This Amendment may be executed in counterparts, which together shall constitute one and the same instrument. Signatures via Conga Sign, DocuSign, .PDF file, facsimile, or other electronic format have the same force and effect as originals.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the Rhode Island Addendum modifies the standard license agreement for franchisees operating in Rhode Island to comply with the Rhode Island Franchise and Distributorship Act and the Rhode Island Franchise Investment Act.
The addendum specifically addresses a few key areas. First, it amends paragraphs 11.C(1)(b) and (d) of the License Agreement relating to the U.S. Bankruptcy Code, clarifying that the enforceability of these provisions is subject to bankruptcy law and court rulings. This provides more legal certainty for the franchisee in the event of bankruptcy proceedings. Second, it incorporates Section 19-28.14 of the Rhode Island Franchise Investment Act, which voids any provision in the franchise agreement that restricts jurisdiction or venue to a forum outside of Rhode Island or requires the application of laws from another state, ensuring that Rhode Island franchisees can pursue claims under the Act within their own state. This provision also applies to the Guaranty. Finally, any provision in the License that designates the governing law as a state other than Rhode Island is deleted, ensuring that Rhode Island law governs the franchise agreement for Even Hotels locations within the state.
In practical terms, these modifications mean that Even Hotels franchisees in Rhode Island will have their franchise agreements interpreted and enforced under Rhode Island law, with specific considerations for bankruptcy proceedings and legal venues. This offers franchisees a degree of protection and clarity under local laws, preventing the franchisor from imposing out-of-state legal requirements or venues that could be disadvantageous to the franchisee. The addendum aims to create a fairer and more predictable legal environment for Even Hotels franchisees operating in Rhode Island.