Is an electronically scanned copy of the Exit agreement bearing a signature considered a valid and binding agreement?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
to Sales Representative or to EXIT [Trade Name] shall exclude any other remedy existing at law or in equity or by statute, but each shall be cumulative and in addition to every other remedy given or now or hereafter existing.
- g) Assignment. This Agreement is personal to Sales Representative and no rights or obligations of Sales Representative under this Agreement shall be assignable by Sales Representative. EXIT [Trade Name] may assign its rights and obligations under this Agreement to any successor to the business of EXIT [Trade Name] or any part of its business, and EXIT [Trade Name] shall be relieved of all obligations under this Agreement arising subsequent to the date of the assignment.
- h) Counterparts. This Agreement may be executed in 2 or more counterparts, all of which taken together shall constitute 1 instrument. Execution and delivery of this Agreement by exchange of electronically scanned copies bearing the signature of a party shall constitute a valid and binding
execution and delivery of this Agreement by the party. Electronically scanned copies shall constitute enforceable original documents.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, an electronically scanned copy of the agreement bearing a signature is considered a valid and binding agreement. This applies to both the Sales Representative Agreement and the Franchise Agreement. For the Sales Representative Agreement, the document states that exchanging electronically scanned copies bearing a party's signature constitutes valid execution and delivery, and these copies are considered enforceable original documents. Similarly, for the Franchise Agreement, exchanging electronically scanned copies with a manual or electronic signature also constitutes a valid and binding execution.
This means that Exit franchisees and sales representatives do not necessarily need to exchange physical, paper copies of the agreement with original signatures. Instead, they can sign and scan the documents, exchanging them electronically. This can expedite the agreement process, reducing the time and costs associated with mailing or delivering physical documents.
However, it is important for prospective Exit franchisees to ensure that the electronically scanned copies are clear, legible, and accurately reflect the terms and conditions of the agreement. Additionally, franchisees should retain both the original signed document and the electronic copy for their records. This practice aligns with the increasing trend of using electronic signatures and document management in the franchise industry, offering convenience and efficiency while maintaining legal validity.