Does the General Release in the All States M.E.D. Franchise Agreement release past assigns of the Releasee?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Release- Franchisee and all of Franchisee's guarantors, members, officers, directors, employees, agents, successors, assigns and affiliates fully and finally release and forever discharge Releasee, its past and present agents, employees, officers, directors, members, Franchisees, successors, assigns and affiliates (collectively "Released Parties") from any and all claims, actions, causes of action, contractual rights, demands, damages, costs, loss of services, expenses and compensation which Franchisee could assert against Released Parties or any of them up through and including the date of this Release.
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- THIS IS A SPECIFIC RELEASE GIVING UP ALL RIGHTS WITH RESPECT TO THE TRANSACTIONS OR OCCURRENCES THAT ARE BEING RELEASED UNDER THIS AGREEMENT.
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- California Releasor- You represent and warrant that YOU EXPRESSLY WAIVE ANY AND ALL RIGHTS AND BENEFITS UNDER CALIFORNIA CIVIL CODE §1542, which provides as follows:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.
- The above Release shall not apply to any liabilities arising under the California Franchise Investment Law, the California Franchise Relations Act, Indiana Code § 23-2-2.5.1 through 23-2-2.7-7, the Maryland Franchise Registration and Disclosure Law, Michigan
- Franchise Investment Law, Minnesota Franchise Act, North Dakota franchise laws, the Rhode Island Investment Act, and the Washington Franchise Investment Protection Act.
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- Releasor agrees to comply with all of its applicable post-termination or post-transfer obligations (as the case may be) in the Franchise Agreement described above.
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, the General Release includes past assigns of the Releasee. Specifically, the release extends to the 'Releasee, its past and present agents, employees, officers, directors, members, Franchisees, successors, assigns and affiliates (collectively "Released Parties")'. This means that the franchisee, along with their guarantors, members, officers, directors, employees, agents, successors, assigns, and affiliates, releases and discharges the Releasee (All States M.E.D.) and all of the Releasee's listed parties from any and all claims.
This release covers a broad range of potential claims, including actions, causes of action, contractual rights, demands, damages, costs, loss of services, expenses, and compensation that the franchisee could assert against the Released Parties. The release is effective up to and including the date it is signed. This indicates that All States M.E.D. seeks to protect itself and related parties from potential liabilities arising from the franchise relationship.
However, the release does not apply to liabilities arising under specific state franchise laws, such as the California Franchise Investment Law, the California Franchise Relations Act, Indiana Code, the Maryland Franchise Registration and Disclosure Law, Michigan Franchise Investment Law, Minnesota Franchise Act, North Dakota franchise laws, the Rhode Island Investment Act, and the Washington Franchise Investment Protection Act. Additionally, in California, the releasor waives rights under California Civil Code §1542, concerning unknown claims that could materially affect the settlement. Franchisees must also comply with post-termination or post-transfer obligations outlined in the Franchise Agreement.