Does the Exit franchise agreement allow a franchisee to disclaim reliance on statements made by the franchisor or its representatives?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the franchise agreement does not allow a franchisee to disclaim reliance on statements made by the franchisor or its representatives. Specifically, any statement, questionnaire, or acknowledgment signed by the franchisee cannot waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor or its representatives. This provision takes precedence over any other conflicting terms in any document related to the franchise agreement.
This means that Exit franchisees retain their legal rights to pursue claims based on misrepresentations or fraudulent statements made to them during the franchise sales process, regardless of any disclaimers they may have signed. This protection is particularly important because it prevents Exit from using standardized documents to shield themselves from liability for misleading information provided to potential franchisees.
This type of clause is generally favorable for franchisees, as it ensures they are not bound by waivers that could prevent them from seeking legal recourse if they were misled. Prospective Exit franchisees should understand that this provision strengthens their position by preserving their ability to hold the franchisor accountable for the accuracy and truthfulness of the information provided during the franchise sales process.