Following the assignment or renewal of a Carvel Franchise Agreement, does the General Release survive?

According to Carvel's 2025 Franchise Disclosure Document, the General Release provided during the assignment or renewal of a Carvel Franchise Agreement does indeed survive. This means that the release, which covers a broad range of potential claims against Carvel Franchisor SPV LLC and related parties, remains in effect even after the franchise agreement is assigned or renewed.

This survival clause has significant implications for prospective franchisees. When assigning or renewing their franchise agreement, franchisees must sign a general release, which protects Carvel from potential future claims. The fact that this release survives the assignment or renewal means that any issues arising before the assignment or renewal are permanently settled, preventing franchisees from bringing up old grievances later. However, it is important to note that this General Release is not intended to waive rights that cannot be waived under applicable state franchise laws, nor does it relieve Carvel from liability imposed by the Maryland Franchise Registration and Disclosure Law.

It is also important to note that the general release required as a condition of renewal, sale, and/or assignment/transfer shall not apply to any liability under the Maryland Franchise Registration and Disclosure Law. Furthermore, in California, the release will not apply to claims under the California Franchise Investment Law and the California Franchise Relations Act. These stipulations provide some protection to franchisees, ensuring that they do not inadvertently waive rights granted to them by specific state laws. Franchisees should carefully review the terms of the general release and consult with legal counsel to fully understand its implications before signing.