Does the Hyper Kidz franchise agreement disclaim representations made in the Disclosure Document?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
BY EXECUTING THE FRANCHISE AGREEMENT, FRANCHISEE AND ANY PRINCIPAL, INDIVIDUALLY AND ON BEHALF OF FRANCHISEE'S AND SUCH PRINCIPAL'S HEIRS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, HEREBY FOREVER RELEASE AND DISCHARGE BOOMERANG FRANCHISE, LLC, MARYLAND INDOOR PLAY, LLC, ANY OTHER AFFILIATES AND ANY PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES, AND THE FOREGOING ENTITIES' DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES FROM ANY AND ALL CLAIMS, DEMANDS AND JUDGMENTS RELATING TO OR ARISING UNDER THE STATEMENTS, CONDUCT, CLAIMS OR ANY OTHER AGREEMENT BETWEEN THE PARTIES EXECUTED PRIOR TO THE DATE OF THE FRANCHISE AGREEMENT, INCLUDING, BUT NOT LIMITED TO, ANY AND ALL CLAIMS, WHETHER PRESENTLY KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, ARISING UNDER THE FRANCHISE, SECURITIES, TAX OR ANTITRUST LAWS OF THE UNITED STATES OR OF ANY STATE OR TERRITORY THEREOF. THIS RELEASE SHALL NOT APPLY TO ANY CLAIMS ARISING FROM REPRESENTATIONS MADE BY FRANCHISOR IN FRANCHISOR'S FRANCHISE DISCLOSURE DOCUMENT RECEIVED BY FRANCHISEE.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, the franchise agreement includes a release and discharge of claims, but explicitly excludes claims arising from representations made in the Franchise Disclosure Document (FDD). By signing the agreement, the franchisee releases Hyper Kidz from claims related to prior statements, conduct, or agreements, with the key exception that this release does not apply to claims stemming from representations made by Hyper Kidz in its FDD. This means a franchisee retains the right to pursue claims against Hyper Kidz if those claims are based on misrepresentations within the FDD itself.
This clause protects the franchisee by ensuring that Hyper Kidz can be held accountable for the accuracy of the information provided in the FDD. Franchise law requires franchisors to provide a comprehensive disclosure document to potential franchisees, and this provision reinforces the importance of that document as a source of reliable information. The franchisee can rely on the statements within the FDD without waiving their right to legal recourse if those statements prove to be false or misleading.
However, it is important to note that this protection is specifically limited to representations made within the FDD. Any other statements, promises, or agreements made outside of the FDD might be subject to the release, potentially limiting the franchisee's ability to bring claims based on those external representations. Therefore, it is crucial for prospective Hyper Kidz franchisees to carefully review the FDD and seek legal counsel to fully understand their rights and obligations before signing the franchise agreement.