For All Team, does the Secured Party's failure to exercise a right constitute a waiver of any default?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) Secured Party's exercise or failure to exercise any right, power, or remedy does not constitute a waiver of any Default under this Agreement.
A waiver, amendment, modification, or termination of this Agreement will be valid and effective only if it is in writing and signed by each party.
In addition, a written waiver by Secured Party of a Default of this Agreement will not operate as a waiver of any other Default or of a succeeding Default under the same provision or as a waiver of the provision itself.
A delay, omission, or course of dealing on the part of Secured Party in exercising any right, power, or remedy will not operate as a waiver of it, except if this Agreement expressly requires the right, power, or remedy to be exercised within a specified time, and a single or partial exercise by Secured Party of any right, power, or remedy does not preclude any further exercise of it or the exercise of any other right, power, or remedy.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the Secured Party's failure to exercise any right, power, or remedy does not constitute a waiver of any default under the agreement. This means that even if the Secured Party does not immediately act upon a default by the Debtor, they still retain the right to enforce that right in the future. This protects the Secured Party's interests by ensuring that their inaction is not interpreted as forgiveness of the default.
Furthermore, a written waiver by the Secured Party of a default will not act as a waiver of any other default, or of a succeeding default under the same provision, or as a waiver of the provision itself. This clause ensures that any leniency shown by the Secured Party in one instance does not set a precedent for future defaults. Each default is treated as a separate event, and the Secured Party's response to one does not limit their ability to enforce the agreement strictly in other situations.
Additionally, a delay, omission, or course of dealing on the part of the Secured Party in exercising any right, power, or remedy will not operate as a waiver of it. The only exception is if the agreement expressly requires the right, power, or remedy to be exercised within a specified time. This provision reinforces the idea that the Secured Party's past actions or inactions do not prevent them from enforcing their rights in the future, unless there is a specific deadline for exercising those rights. A single or partial exercise by Secured Party of any right, power, or remedy does not preclude any further exercise of it or the exercise of any other right, power, or remedy.