What is the effect of the personal guaranty on the heirs, legal representatives, and assigns of the undersigned persons in the B Bops franchise agreement?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
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- In consideration of the development rights granted to Developer hereunder and in order to induce Company to grant such development rights to Developer, each of the undersigned hereby agrees, jointly, individually and severally, for themselves, their heirs, legal representatives and assigns as follows: (a) that they, and each of them, shall be personally bound by and agree to perform all of the terms, provisions and conditions of this Agreement; (b) that they, and each of them, do hereby personally and unconditionally guarantee full and prompt payment to Company of any indebtedness of Developer arising under or by virtue of this Agreement; (c) that they, and each of them, will not sell, assign or otherwise permit or cause a transfer of the development rights or any partnership or stock interest in Developer without complying with the requirements of Section 13 of the Agreement; (d) that they, and each of them, shall be personally bound by the nondisclosure and noncompete covenants of this Agreement; and (e) that they, and each of them, shall be personally liable for the breach of any provision of this Agreement, including both monetary obligations and any obligation to take or refrain from taking specific actions or activities.
Source: Item 23 — RECEIPTS (FDD pages 53–145)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, the personal guaranty extends to the heirs, legal representatives, and assigns of the individuals who sign the guaranty. This means that the obligations and liabilities under the Multiple-Unit Development Agreement are not extinguished upon the death or incapacitation of the guarantor but instead pass on to their estate or designated representatives.
Specifically, each person signing the guaranty agrees, jointly, individually, and severally, for themselves, their heirs, legal representatives, and assigns, to be personally bound by and perform all terms, provisions, and conditions of the Agreement. They also guarantee the full and prompt payment of any indebtedness of the Developer arising under the Agreement. Furthermore, they are bound by the nondisclosure and noncompete covenants and are personally liable for any breach of the Agreement.
This provision ensures that B Bops has recourse for any financial or contractual breaches even if the original guarantor is no longer able to fulfill their obligations. Prospective franchisees should carefully consider the implications of this personal guaranty, as it could have long-term financial consequences for their families and estates.