What is the 'Guaranty' in the Big Frog Custom T Shirts More Spousal Guaranty?
Big_Frog_Custom_T_Shirts_More Franchise · 2024 FDDAnswer from 2024 FDD Document
As an inducement for Big Frog Custom T-Shirts, Inc. ("Franchisor") to execute that certain Franchise Agreement (the "Franchisor Agreement") between Franchisor and , a(n) and's principals and (collectively "Franchisee") the undersigned ("Guarantor"), hereby unconditionally guarantees to Franchisor and its successors and assigns that all of Franchisee's monetary and non-monetary obligations under the Franchise Agreement will be punctually paid and performed. Guarantor acknowledges that Guarantor has read the terms and conditions of the Franchise Agreement and acknowledges that the execution of this Guaranty and the obligations of Guarantor herein are in partial consideration for, and a condition to the granting of, the rights granted in the Franchise Agreement, and that Franchisor would not have granted these rights without the execution of this Guaranty by Guarantor.
Guarantor hereby individually makes, agrees to be bound by, and agrees to perform, all of the covenants, representations, warranties and agreements of Franchisee as set forth in the Franchise Agreement, including but not limited to, the covenants set forth in Sections 19.2, 19.5, 19.6, 19.8 and 19.9 of the Franchise Agreement. In particular, Guarantor promises that Guarantor will not, during the Term of the Franchise Agreement, as may be extended, or thereafter, communicate, divulge or use for the benefit of any other person, partnership, association, limited liability company or corporation any Confidential Information, as that term is defined in the Franchise Agreement, which includes without limitation, any information relating to the Big Frog Operations Manual and other materials used in or related to the System, the methods of operation of the System, vendor information and financial data.
Guarantor promises that during the Term of the Franchise Agreement, as may be extended or renewed, Guarantor will not, for Guarantor, or in conjunction with any person or legal entity:
- (i) divert or attempt to divert any present or prospective business or customer of Franchisor, Franchisee or any other Big Frog franchisee to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Big Frog trademarks and Big Frog franchise system; or
- (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any retail apparel printing business similar to the System.
Guarantor promises that for a continuous, uninterrupted period of twenty-four (24) months following the assignment, termination or expiration of the Franchise Agreement, as may be extended or renewed, Guarantor will not, for Guarantor, or in conjunction with any person or legal entity:
- (i) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in any retail apparel printing business similar to the System within twenty five (25) miles of the Territory or any Big Frog location; or
- (ii) divert or attempt to divert any past, present or prospective business or customer of any Big Frog business (including Franchisee's) to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Big Frog trademarks and Big Frog franchise system.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2024 FDD)
According to Big Frog Custom T Shirts More's 2024 Franchise Disclosure Document, the Personal Guaranty requires the guarantor to ensure the franchisee fulfills all monetary and non-monetary obligations under the Franchise Agreement. This means the guarantor is responsible for the franchisee's debts and performance. The guarantor acknowledges they have read the Franchise Agreement and that their guarantee is a condition for granting the franchise rights.
The guarantor also agrees to be bound by the same covenants, representations, warranties, and agreements as the franchisee, including confidentiality clauses. Specifically, the guarantor promises not to disclose or use any confidential information related to the Big Frog system, such as the operations manual, methods, vendor information, and financial data, during and after the term of the Franchise Agreement.
Furthermore, during the term of the Franchise Agreement, the guarantor is prohibited from engaging in activities that could harm the Big Frog Custom T Shirts More franchise system. This includes diverting business to competitors or participating in similar retail apparel printing businesses. After the termination or expiration of the Franchise Agreement, the guarantor is restricted from participating in a similar business within 25 miles of the territory or any Big Frog location for a period of 24 months, and from diverting business from any Big Frog business.