Does the Bombs Away General Release prevent a franchisee from participating in any legal proceeding?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
- **2.
Covenant Not to Sue.** Releasor (on behalf of all Releasing Parties) covenants not to initiate, prosecute, encourage, assist, or (except as required by law) participate in any civil, criminal, or administrative proceeding or investigation in any court, agency, or other forum, either affirmatively or by way of cross-claim, defense, or counterclaim, against any Released Party with respect to any Claim.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to the 2024 Bombs Away Franchise Disclosure Document, the General Release includes a covenant not to sue. This means a franchisee (referred to as the 'Releasor' in the document) agrees not to initiate or participate in any legal proceeding against Bombs Away Franchising (referred to as the 'Released Parties') regarding any claims covered by the release. This extends not only to direct lawsuits but also to participating in proceedings as a cross-claimant, in defense, or as a counterclaimant.
However, there is an exception: the franchisee is not prevented from participating in a legal proceeding if required by law. This suggests that if a franchisee is legally compelled to participate in a proceeding, the General Release does not prohibit it.
The General Release specifies that it covers all claims known or unknown, based on events that occurred through the date of the release, including those arising out of the Franchise Agreement. This is a broad release, and franchisees should carefully consider its implications and consult with an attorney before signing it. Bombs Away may require a general release from a franchisee upon renewal of the franchise or as a condition of approving a sale of the franchise.
It is important for a prospective Bombs Away franchisee to understand the scope of this release and how it might affect their legal rights in the future. Franchisees should seek legal counsel to fully understand the implications of the General Release before signing it.