Are the acknowledgments, promises, covenants, agreements, and obligations made by the Franchisee in the Belocal agreement undertaken jointly and severally by all Principals?

According to Belocal's 2025 Franchise Disclosure Document, the acknowledgments, promises, covenants, agreements, and obligations made or undertaken by the franchisee in the Franchise Agreement are deemed to have been jointly and severally undertaken by all of the principals. This means that each principal is individually responsible for the franchisee's obligations, as well as collectively responsible as a group.

This has significant implications for prospective Belocal franchisees, particularly those who plan to operate their franchise through a business entity with multiple owners or principals. Each principal signing the agreement is taking on personal liability for the entire franchise's obligations. If the franchise fails to meet its financial or contractual obligations, Belocal can pursue any or all of the principals individually for the full amount owed, regardless of their individual ownership stake or involvement in the business.

This joint and several liability extends to various aspects of the franchise agreement, including financial obligations, adherence to brand standards, and compliance with legal requirements. Principals should carefully consider the risks associated with this arrangement and seek legal counsel to fully understand their obligations and potential liabilities before signing the Belocal Franchise Agreement and Principals' Undertaking.