Does the Potbelly Sandwich Works agreement define what constitutes a waiver?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
- No Waiver of Disclaimer of Reliance. The following provision is added to the Franchise Agreement:
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 any other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
- Application of Rider. There are circumstances in which an offering made by us would not fall within the scope of the New York General Business Law, Article 33, such as when the offer and acceptance occurred outside the State of New York. However, an offer or sale is deemed to be made in New York if you are domiciled, and the franchise will be opened, in New York. We are required to furnish a New York prospectus to every prospective franchisee who is protected under the New York General Business Law, Article 33.
Source: Item 23 — RECEIPTS (FDD pages 79–355)
What This Means (2025 FDD)
According to the 2025 Potbelly Sandwich Works Franchise Disclosure Document, the franchise agreement addresses the concept of waivers in several contexts. Specifically, it states that no statement, questionnaire, or acknowledgment signed by a franchisee can waive claims under state franchise law or disclaim reliance on franchisor statements. This provision is designed to protect franchisees from inadvertently giving up their legal rights.
Additionally, the agreement includes a section pertaining to transactions with California franchisees, referencing California Civil Code Section 1542, which concerns general releases and unknown claims. This section requires franchisees to acknowledge they are aware they may be giving up claims they don't yet know about and to waive any rights or benefits under Section 1542 or similar statutes. This is a standard legal practice to ensure that releases are comprehensive and cover unforeseen issues.
Furthermore, the guarantor (if any) in the agreement irrevocably waives certain rights, including presentment, demand, protest, and notice, and any requirement that the franchisor take action against the purchaser or any other person. This waiver is part of the guarantee to ensure the guarantor remains liable for the guaranteed obligations. These clauses collectively define specific instances and rights that are subject to waiver within the Potbelly Sandwich Works franchise agreement, ensuring clarity and legal enforceability.