Does the Clean Your Dirty Face consent release the transferor parties from all obligations?
Clean_Your_Dirty_Face Franchise · 2025 FDDAnswer from 2025 FDD Document
entation or warranty that is not true as of the Effective Date or the Transfer Date, Franchisor's consent to the Transfer may be withdrawn, and any transfer that occurs thereafter, of any kind, including the Transfer, shall be deemed an unauthorized transfer under the terms of the Original Agreement.
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- Termination of Original Agreement. Upon consummation of the Transfer, the Original Agreement will automatically terminate effective as of the Transfer Date. After the Transfer Date, the provisions of the Original Agreement shall be of no further force or effect; provided, that nothing in this Consent will be deemed to terminate or release the Transferor Parties from any of the following obligations (together, the "Surviving Obligations"): (i) any obligations under the Original Agreement that, either expressly or by their nature, survive termination thereof (including, post-
termination restrictive covenants, indemnification, dispute resolution, non-disparagement, confidentiality provisions, and the obligation to cease using any proprietary trademarks); (ii) any obligations arising prior to the Transfer Date (including any obligations to pay any amounts to Franchisor accruing prior to the Transfer Date); (iii) any failure to perform, improper performance, or other breach, default or violation by any Transferor Party of the Original Agreement; or (iv) any obligations of the Transferor Parties under this Consent. The Original Guaranty shall remain in force and effect and shall serve as a guaranty of the Surviving Obligations, and Transferor Guarantors acknowledge and agree that Franchisor may seek any available remedies against them for the failure of any Transferor Party to comply with any Surviving Obligations.
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- Representations and Warranties. The Transferor Parties and the Transferee Parties each hereby, jointly and severally, represent and warrant to Franchisor as of the Effective Date and as of the Transfer Date that: (i) Transferor and Transferee are each a legal entity duly organized, validly existing and in good standing under the laws of their respective jurisdiction of organization; (ii) Transferor and Transferee each have all requisite power and authority to be bound by the terms hereof and to carry out and perform its obligations under this Consent, the Purchase Agreement, and in the case of Transferee, the New Agreement (as defined below); and (iii) the parties have provided Franchisor with a final executed and effective copy of the Purchase Agreement and no provision of the Purchase Agreement has been modified, amended, waived, or disclaimed in any manner by the parties thereto prior to the Effective Date.
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- Conditions to Consent.
Source: Item 23 — RECEIPTS (FDD pages 54–186)
What This Means (2025 FDD)
According to Clean Your Dirty Face's 2025 Franchise Disclosure Document, the consent to transfer does not release the transferor parties from all obligations. Specifically, the original agreement between the transferor and Clean Your Dirty Face will terminate upon the transfer's completion, but certain obligations will survive.
The surviving obligations include those that expressly or by their nature survive termination, such as post-termination restrictive covenants, indemnification, dispute resolution, non-disparagement, and confidentiality provisions. Additionally, the obligation to cease using Clean Your Dirty Face's proprietary trademarks remains. The transferor remains responsible for any obligations arising before the transfer date, including payments due to Clean Your Dirty Face, and for any breaches or failures to perform under the original agreement. The original guaranty remains in effect for these surviving obligations, allowing Clean Your Dirty Face to pursue remedies against the transferor guarantors if the transferor fails to comply with these obligations.
Furthermore, the transferor parties, along with their affiliates, release Clean Your Dirty Face from all claims and liabilities from the beginning of time to the effective date of the consent. This release covers all types of claims, known or unknown, related to the original agreement or the relationship between the transferor and Clean Your Dirty Face. However, this franchisor release does not mean the transferor is released from their obligations.