What is Exhibit 5 in the Closet Storage Concepts franchise agreement related to?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
Our current form of release is attached to this Agreement as Exhibit "5".
- 2.4.4 All amounts to be paid by Franchisee to Franchisor and/or its affiliates are currently paid, and no default under this Agreement exists uncured five (5) days after the Franchisee has received written notice of any overdue amounts.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to the 2025 Closet Storage Concepts FDD, Exhibit 5 of the franchise agreement contains the current form of release that a franchisee must execute to renew their franchise agreement. Specifically, to exercise the renewal option, the franchisee must present a release of any and all claims against Closet Storage Concepts and its affiliates.
The release must adhere to the language and form chosen by Closet Storage Concepts, but it cannot release any liability specifically provided for by any applicable state statute regulating franchising. This means that while Closet Storage Concepts has control over the release's wording, it must still comply with state laws that protect franchisees.
This requirement is fairly standard in franchising, as franchisors want to avoid potential legal issues when a franchisee renews their agreement. By signing the release, the franchisee gives up their right to sue Closet Storage Concepts for any past issues, except those protected by state franchise laws, providing the franchisor with legal protection moving forward.