When signing the Exit franchise agreement, what prior agreements are franchisees releasing claims against?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
By executing this Agreement, Franchisee, individually and on behalf of Franchisee's heirs, legal representatives, successors, and assigns, and each assignee of this Agreement by accepting assignment of the same, hereby forever releases and discharges EXIT, Subfranchisor, and their respective officers, directors, employees, agents and servants, and their subsidiary and affiliated corporations, their respective officers, directors, employees, agents and servants, from any and all claims relating to or arising under any franchise agreement or any other agreement between the parties and executed prior to the date of this Agreement including but not limited to any and all claims, whether presently known or unknown, suspected or unsuspected.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, when a franchisee signs the franchise agreement, they are releasing Exit, the subfranchisor, and their respective officers, directors, employees, agents, and servants from any claims relating to or arising under any franchise agreement or any other agreement between the parties that was executed prior to the date of the current agreement. This release includes all claims, whether known or unknown, suspected or unsuspected.
In practical terms, this means that if a franchisee has any existing disputes or potential legal issues with Exit or its affiliates stemming from previous agreements, those claims are waived upon signing the new franchise agreement. This is a standard clause in franchise agreements, designed to provide clarity and prevent future litigation based on past dealings.
However, it is important to note that this release does not extend to claims arising from representations made in the Franchise Disclosure Document itself. This means that a franchisee can still bring a claim against Exit if they believe they were misled by the information provided in the FDD. Additionally, any statement, questionnaire, or acknowledgment signed by a franchisee cannot waive claims under applicable state franchise law, including fraud in the inducement, or disclaim reliance on statements made by the franchisor or its representatives.