In the Dryject agreement, does the exercise of rights under Section 32 discharge the franchisee from liabilities or obligations that continue beyond the termination of the agreement?

According to Dryject's 2025 Franchise Disclosure Document, the exercise of rights under Section 32 of the agreement does not discharge or release the franchisee from any liability or obligation then accrued, or any liability or obligation continuing beyond, or arising out of, the expiration, the earlier termination, or the exercise of such rights under the agreement. This means that even after Dryject exercises its rights under Section 32, a franchisee may still be responsible for financial or other obligations that were in place before the action or that extend beyond the termination date.

This provision ensures that franchisees cannot avoid their responsibilities by simply terminating the agreement or having it terminated. For example, if a franchisee owes Dryject royalty fees or other payments at the time of termination, they are still obligated to pay those fees, even after the franchise agreement is no longer in effect. Similarly, if the franchisee has ongoing obligations, such as maintaining confidentiality or non-compete agreements, these obligations remain in force even after termination.

This clause is typical in franchise agreements to protect the franchisor's interests and ensure that franchisees fulfill their contractual duties. Prospective Dryject franchisees should carefully review Section 32 and related sections of the franchise agreement to fully understand the circumstances under which Dryject can exercise its rights and the franchisee's continuing obligations after such exercise or termination. Understanding these obligations is crucial for assessing the potential financial and legal risks associated with investing in a Dryject franchise.