Does the expiration or termination of the Devon Creek Franchise Agreement release the franchisee from accrued liabilities?
Devon_Creek Franchise · 2024 FDDAnswer from 2024 FDD Document
- 18.1.4 promptly pay all sums owing to Franchisor and its affiliates. Such sums shall include all damages, costs and expenses, including reasonable attorneys' fees, incurred by Franchisor as a result of any default by Franchisee. The payment obligation herein shall give rise to and remain, until paid in full, a lien in favor of Franchisor against any and all of the personal property, furnishings, equipment,
fixtures, and inventory or other business assets owned by Franchisee at the time of default;
18.1.5 pay to Franchisor all damages, costs and expenses, including reasonable attorneys' fees, incurred by Franchisor in connection with obtaining any remedy available to Franchisor for any violation of this Agreement and, subsequent to the termination or expiration of this Agreement, in obtaining injunctive or other relief for the enforcement of any provisions of this Agreement that survive its termination;
Source: Item 22 — CONTRACTS (FDD page 45)
What This Means (2024 FDD)
According to the 2024 Devon Creek Franchise Disclosure Document, termination or expiration of the Franchise Agreement does not release the franchisee from accrued liabilities. Upon termination or expiration, the franchisee must promptly pay all sums owed to Devon Creek and its affiliates. These sums include all damages, costs, and expenses, including reasonable attorneys' fees, incurred by Devon Creek due to any default by the franchisee.
This payment obligation creates a lien in favor of Devon Creek against all personal property, furnishings, equipment, fixtures, inventory, or other business assets owned by the franchisee at the time of default. The franchisee is also responsible for paying all damages, costs, and expenses, including reasonable attorneys' fees, incurred by Devon Creek in connection with obtaining any remedy for any violation of the Franchise Agreement. This obligation extends to obtaining injunctive or other relief for the enforcement of any provisions of the agreement that survive its termination.
This clause is standard in franchise agreements to protect the franchisor's financial interests and ensure that franchisees fulfill their financial obligations even after the agreement ends. Prospective Devon Creek franchisees should understand that termination or expiration of the agreement does not absolve them of outstanding debts or liabilities to the franchisor.