Does any provision in the Alloy Area Development Agreement require a franchisee to disclaim acts that would violate the Maryland Franchise Registration and Disclosure Law?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
Any provision in the Agreement that requires you to disclaim the occurrence and/or acknowledge the non-occurrence of acts that would constitute a violation of the Maryland Franchise Registration and Disclosure Law is not intended to nor will it act as a release, estoppel or waiver of any liability incurred under the Maryland Franchise Registration and Disclosure Law.
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- No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection with the commencement of the franchise relationship shall be construed or interpreted as waiving any claim of fraud in the inducement, whether common law or statutory, or as disclaiming reliance on or the right to rely upon any statement made or information provided by any franchisor, broker or other person acting on behalf of the franchisor that was a material inducement to a franchisee's investment. This provision supersedes any other or inconsistent term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, the Area Development Agreement includes provisions that address potential conflicts with the Maryland Franchise Registration and Disclosure Law. Specifically, any part of the agreement that might require a franchisee to disclaim or deny actions that would violate this Maryland law will not be considered a release, estoppel, or waiver of liability under that law. This means Alloy franchisees in Maryland retain their rights and protections under Maryland franchise law, regardless of any conflicting language in the standard Area Development Agreement.
This protection is further reinforced by stating that no disclaimer, questionnaire, clause, or statement signed by an Alloy franchisee can be interpreted as a waiver of claims related to fraud in the inducement. This ensures franchisees cannot unknowingly or unintentionally give up their right to pursue claims of fraud based on statements or information provided by Alloy during the franchise sales process. This provision specifically overrides any other conflicting terms in any document associated with the franchise agreement.
Furthermore, Alloy's FDD includes an addendum for Maryland franchises to ensure compliance with Maryland statutes and regulations. This addendum modifies specific sections of the Area Development Agreement, such as those related to waivers, integration, venue, and conditions of transfer, to explicitly state that they do not apply to liabilities under the Maryland Franchise Registration and Disclosure Law. This comprehensive approach indicates a proactive effort by Alloy to protect the rights of its Maryland franchisees and adhere to state-specific franchise regulations.