What is the term of the Guaranty for the Apricot Lane franchise, and does it extend beyond the Franchise Agreement's term?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
SECTION 24: "FRANCHISEE" DEFINED AND GUARANTY
As used in this Agreement, the term "FRANCHISEE" shall include any and all general partners of FRANCHISEE and any and all owners (including shareholders, members, limited partners and other owners) of five percent (5%) or more beneficial or legal interest in FRANCHISEE and/or the Franchised Business, and all successors in interest of FRANCHISEE or any such individual. All such individual partners, shareholders, members and owners shall execute the Guaranty and Assumption of Obligations attached hereto as Exhibit D and made a part hereof. By their signatures thereto, all such parties acknowledge and agree to be bound by the provisions of this Agreement in the same manner and to the same extent as FRANCHISEE.
I. Survival of Terms
All obligations of FRANCHISOR and FRANCHISEE which expressly or by their nature survive the expiration or termination of this Agreement shall continue in full force and effect subsequent to and notwithstanding its expiration or termination if this Agreement until they are satisfied or by their specific provisions or nature expire.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to the 2025 Apricot Lane Franchise Disclosure Document, the term "FRANCHISEE" includes general partners and owners with 5% or more interest in the franchise. These individuals must execute a Guaranty and Assumption of Obligations, as detailed in Exhibit D. By signing, they agree to be bound by the Franchise Agreement's provisions just as the franchisee is.
Additionally, the FDD states that all obligations of Apricot Lane and the franchisee that expressly or by their nature survive the expiration or termination of the agreement will remain in effect even after the agreement ends. This continuation lasts until these obligations are satisfied or expire according to their specific terms.
While the FDD excerpt specifies that certain obligations extend beyond the termination of the agreement, it does not explicitly state the term or duration of the Guaranty itself, nor does it clarify whether the Guaranty extends beyond the Franchise Agreement's term. To fully understand the implications of the Guaranty, a prospective franchisee should carefully review Exhibit D and seek clarification from Apricot Lane regarding the Guaranty's specific term and post-termination obligations.