Does the Boulder Designs franchise agreement require a Guaranty and Assumption of Obligations?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
TO THE FRANCHISE AGREEMENT
GUARANTY AND ASSUMPTION OF OBLIGATIONS
I have read the Franchise Agreement between BOULDER DESIGNS FRANCHISING, LLC and (the "Franchisee").
I own a beneficial interest in the Franchisee, and would be considered an "Owner" within the definition contained in Franchise Agreement.
I understand that, were it not for this Guaranty and Assumption of Obligation ("Guaranty"), Franchisor would not have agreed to enter into the Franchise Agreement with the Franchisee.
I will comply with all of the provisions contained in Article 7 of the Franchise Agreement concerning the use of the Confidential Information.
I will maintain the confidentiality of all Confidential Information disclosed to me.
I agree to use the Confidential Information only for the purposes authorized under the Franchise Agreement.
I further agree not to disclose any of the Confidential Information, except (a) to the Franchisee's employees on a need to know basis, (b) to the Franchisee's and my legal and tax professionals to the extent necessary for me to meet my legal obligations, and (c) as otherwise may be required by law.
I will comply with all of the provisions contained in Article 18 of the Franchise Agreement concerning the assignment of my interests in the Franchisee.
I hereby guarantee the prompt and full payment of all amounts owed by the Franchisee under the Franchise Agreement.
Boulder Designs® 1 Exhibit 3
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- I will pay all amounts due under this Guaranty within 14 days after receiving notice from Franchisor that the Franchisee has failed to make the required payment. I understand and agree that Franchisor need not exhaust its remedies against the Franchisee before seeking recovery from me under this Guaranty.
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- I WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM, WHETHER AT LAW OR IN EQUITY, INVOLVING FRANCHISOR, WHICH ARISES OUT OF OR IS RELATED IN ANY WAY TO THE FRANCHISE AGREEMENT AND/OR THE PERFORMANCE OF ANY PARTY UNDER THE FRANCHISE AGREEMENT.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to the 2025 Boulder Designs Franchise Disclosure Document, the franchise agreement includes a Guaranty and Assumption of Obligations. This agreement is signed by individuals who own a beneficial interest in the franchisee, referred to as "Owners." Boulder Designs requires this guaranty because they would not enter into the Franchise Agreement without it.
The Guaranty and Assumption of Obligations requires the Owner to comply with specific articles of the Franchise Agreement, including Article 7 regarding the use of Confidential Information and Article 18 concerning the assignment of interests in the franchisee. The owner must maintain the confidentiality of all confidential information and only use it for authorized purposes under the Franchise Agreement. Furthermore, the owner guarantees the prompt and full payment of all amounts owed by the franchisee under the Franchise Agreement and agrees to pay these amounts within 14 days of receiving notice from Boulder Designs that the franchisee has failed to make payment.
Moreover, the Guaranty includes a waiver of trial by jury in any action related to the Franchise Agreement. It also stipulates that Boulder Designs' rights under the Guaranty are in addition to any other rights or remedies available under applicable law. The Guaranty is governed by the laws of Texas, and any notices will be deemed delivered based on specific delivery methods outlined in the agreement. This comprehensive Guaranty ensures that Boulder Designs has additional recourse in case the franchisee fails to meet its financial obligations or breaches the Franchise Agreement.