Under the Belocal Transfer Agreement, what specific entities are included in the definition of 'Transferor Parties' that are released by the Franchisor?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
Except for the obligations set forth in this Transfer Agreement, Franchisor irrevocably and unconditionally releases, acquits, and forever discharges Transferor and each Transferor Principal ("Transferor Parties") from all actions, causes of action, suits, debts, liens, obligations, promises, liabilities, claims, rights, demands, damages, controversies, losses, costs, and expenses (including attorneys' fees and costs actually incurred), known or unknown, suspected or unsuspected, fixed or contingent, which Franchisor now has, owns, holds, claims to have, claims to own, or claims to hold, or at any time heretofore had owned, held, claimed to have, claimed to own, or claimed to hold against any Transferor Party arising out of or relating to the Franchise Agreement.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the Transfer Agreement outlines the release of claims by the franchisor. Specifically, the "Transferor Parties" who are released consist of the Transferor and each Transferor Principal. This means that Belocal, as the franchisor, agrees to release both the franchisee transferring their franchise (the Transferor) and any individuals who are principals of that franchisee from certain liabilities and claims.
This release covers all actions, causes of action, suits, debts, liens, obligations, promises, liabilities, claims, rights, demands, damages, controversies, losses, costs, and expenses, including attorney's fees. The release applies to both known and unknown issues, suspected or unsuspected, and fixed or contingent matters that the franchisor may have against the Transferor Parties. The claims being released arise from or relate to the Franchise Agreement.
For a prospective Belocal franchisee, this is a beneficial aspect of the transfer process. It provides clarity and protection by ensuring that once the transfer is complete and the agreement is executed, the transferring franchisee and their principals are free from potential future claims by Belocal related to the original franchise agreement. However, it is important for the franchisee to fully understand the scope of this release and to consult with an attorney to ensure that all potential liabilities are adequately addressed during the transfer process.