Who must execute a general release of claims against Nothing Bundt Cakes during a transfer?

According to Nothing Bundt Cakes' 2025 Franchise Disclosure Document, both the transferring franchisee and their principals, as well as the transferee (if they have had any prior relationship with Nothing Bundt Cakes or its affiliates), must execute a general release of claims against Nothing Bundt Cakes during a transfer. This release must be in a form satisfactory to Nothing Bundt Cakes. The principals of the transferring franchisee are required to sign if the franchisee is a partnership, corporation, or limited liability company.

The general release serves to protect Nothing Bundt Cakes, its affiliates, and their respective officers, directors, shareholders, and employees from any potential claims arising from the franchisee's operation or relationship with the company up to the date of the transfer. This includes any known or unknown claims, and the release applies in both corporate and individual capacities. However, the release will not be inconsistent with any applicable state statute regulating franchising.

This requirement is a fairly standard practice in franchising to ensure a clean break between the franchisor and the outgoing franchisee, while also addressing any potential liabilities with the incoming franchisee if a prior relationship existed. Prospective Nothing Bundt Cakes franchisees should carefully review the release document with legal counsel to understand the full scope of claims being waived and ensure compliance with any state-specific regulations.