Does the Cool Binz agreement specify any exceptions to the mutual releases?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
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- [MARYLAND – for use in MD only] This Mutual Release may not apply to any liability under the Maryland Franchise Registration and Disclosure Law.
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- [TRANSFERS – WHEN BUYER IS PAYING IN INSTALLMENTS] FRANCHISE OWNER(S) and Franchisee acknowledge and agree (i) that they negotiated the sale of their franchise to Buyer Company without the assistance, or any other involvement of the Franchisor; (ii) that the purchase price for such sale (the "Purchase Price") will not be paid in full at closing, but will be paid over a period of time after closing, and (iii) that they are assuming the full risk of nonpayment of the Purchase Price, FRANCHISE OWNER(S) and Franchisee further agree that they will not, in any manner, at any time, under any set of circumstances, seek payment of any portion of the Purchase Price from Cool Binz International, LLC, and/or any of its directors, officers, members, shareholders, employees, agents, representatives, heirs, successors or assigns.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, there are specific conditions under which the mutual release may not apply. For franchisees in Maryland, the mutual release might not cover liabilities arising from the Maryland Franchise Registration and Disclosure Law. This means that Cool Binz franchisees in Maryland retain certain rights and protections under state franchise law, regardless of the general release.
Additionally, the agreement outlines a scenario regarding transfers of ownership where the buyer pays in installments. In such cases, the selling franchisee acknowledges that they negotiated the sale independently of Cool Binz and assumes the risk of non-payment. The franchisee specifically agrees not to seek payment from Cool Binz International, LLC, or its affiliates for any unpaid portion of the purchase price. This protects Cool Binz from becoming involved in financial disputes between the buyer and seller during a franchise transfer.
These exceptions to the mutual release are important for prospective Cool Binz franchisees to understand, as they clarify the scope of the release and highlight specific situations where certain liabilities or claims are not waived. Franchisees should consult with legal counsel to fully understand the implications of these provisions in their specific circumstances.