What document must Guarantors of a Bft franchise sign and deliver?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are a legal entity, such as a limited liability company, partnership, or corporation, each person who directly or indirectly owns a 10% or greater ownership in you (each, a "Guarantor") must sign and deliver to us our then-current form of Guarantee, Indemnification, and Acknowledgment (a "Guarantee"), and one of your Guarantors must be designated as an Operating Principal, who has the authority communicate with us and otherwise act on your behalf in all matters relating to your Studio.
Source: Item 1 — THE FRANCHISOR, ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 7–12)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, if the franchisee is a legal entity such as a limited liability company, partnership, or corporation, each individual who directly or indirectly owns 10% or greater ownership in the entity must sign and deliver a Guarantee, Indemnification, and Acknowledgment form to Bft. This form is referred to as a "Guarantee".
This requirement ensures that individuals with significant ownership in the franchisee entity are personally responsible for the franchise's obligations to Bft. This is a common practice in franchising, as it provides the franchisor with additional security and recourse in case the franchisee entity fails to meet its contractual obligations.
Furthermore, Bft requires that one of the Guarantors be designated as an Operating Principal. This Operating Principal will have the authority to communicate with Bft and act on behalf of the franchise in all matters related to the studio. This ensures that Bft has a clear point of contact and a responsible party to address any issues that may arise during the operation of the franchise.