What is the purpose of Exhibit H in the Pump It Up Franchise Disclosure Document?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
OTHER STATES MAY REQUIRE REGISTRATION, FILING OR EXEMPTION OF A FRANCHISE UNDER OTHER LAWS, SUCH AS THOSE THAT REGULATE THE OFFER AND SALE OF BUSINESS OPPORTUNITIES OR SELLER-ASSISTED MARKETING PLANS.
Exhibit H Additional Disclosures Required by Certain States/ Addenda Required by Certain States Pump It Up Franchise Disclosure Document
ADDITIONAL DISCLOSURES REQUIRED BY THE STATE OF CALIFORNIA
The registration of this franchise offering by the California Department of Financial Protection and Innovation does not constitute approval, recommendation, or endorsement by the Commissioner.
The California Franchise Investment Law requires that a copy of all proposed agreements relating to the sale of the Franchise be delivered together with the FDD 14 days prior to execution of any agreement.
California Corporations Code Section 31125 requires us to give to you a FDD approved by the California Department of Financial Protection and Innovation before we ask you to consider a material modification of your Franchise Agreement.
The Franchise Agreement contains provisions requiring litigation, with the costs being awarded to the prevailing party.
The litigation will occur in Franchisor's then existing principal business location.
Prospective franchisees are encouraged to consult private legal counsel to determine the applicability of California and federal laws (such as Business and Professions Code Section 20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions of the Franchise Agreement restricting venue to a forum outside the State of California.
The Franchise Agreement requires the application of the law of Arizona.
This provision may not be enforceable under California law.
Neither Franchisor nor any other person listed in Item 2 of the FDD is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities Exchange Act of 1934, 15 U.S.C.A. 78a et seq., suspending or expelling such persons from membership in such association or exchange.
The following statement is added to Item 5:
- a) "The Department has determined that we, the franchisor, have not demonstrated we are adequately capitalized and/or that we must rely on franchise fees to fund our operations.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to the 2025 Pump It Up Franchise Disclosure Document, Exhibit H contains additional disclosures and addenda that are required by certain states. Specifically, the exhibit includes disclosures required by the state of California. These disclosures cover various aspects of the franchise relationship.
For example, the California Franchise Investment Law mandates that all proposed agreements related to the sale of the Pump It Up franchise must be delivered along with the FDD at least 14 days before any agreement is executed. Additionally, California Corporations Code Section 31125 requires that Pump It Up provide a FDD approved by the California Department of Financial Protection and Innovation before asking a franchisee to consider any material modifications to their Franchise Agreement. The exhibit also notes that the Franchise Agreement contains provisions requiring litigation in the franchisor's principal business location, with costs awarded to the prevailing party.
Furthermore, Exhibit H points out that the Franchise Agreement requires the application of Arizona law, which may not be enforceable under California law. It also includes a statement added to Item 5, indicating that the Department has determined that Pump It Up has not demonstrated adequate capitalization and may rely on franchise fees to fund its operations. These disclosures are crucial for prospective franchisees in California to understand their rights and the specific legal considerations applicable to their franchise agreement.