Is an Owner's Guaranty and Assumption of Franchisee's Obligations required to be signed in connection with the Brain Balance Franchised Business?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
to FRANCHISEE or any third party by reason of any neglect, delay, or denial of any approval requested hereunder.
10. ADDITIONAL OBLIGATIONS OF FRANCHISEE
10.01. FRANCHISEE shall faithfully abide by the terms of this Agreement and devote his/her full time and efforts to the promotion and success of the Franchised Business. In the event, following the opening of the Franchised Business, FRANCHISEE desires to operate a business other than the Franchised Business, FRANCHISEE agrees to obtain COMPANY's consent prior to taking any steps in connection with such proposed business, which consent may be refused for any reason or no reason.
10.02. FRANCHISEE shall not harm, misuse, or bring into disrepute the name or character of "BBF," "Brain Balance®," "Brain Balance Program®," or the Marks or any other trade name, trademark, service mark, service name, logo, or copyright of COMPANY or COMPANY's business or the business of any franchisee of COMPANY.
10.03. FRANCHISEE shall operate the Franchised Business from a self-contained space located in a retail building within the Territory in accordance with the terms and intent of this Agreement in a lawful and ethical manner as specified by COMPANY in its Operations Manual. FRANCHISEE shall obtain all permits and business licenses required by law for its Center location and shall comply with all premises regulatory requirements. FRANCHISEE shall obtain prior written approval from COMPANY of the lease, sign the lease within 120 days of the execution of this Agreement, and provide a copy of the executed lease to COMPANY within ten (10) days of its execution. The lease shall contain provisions that permit assignment to COMPANY and expressly provide that there are no obligations imposed on or granted against COMPANY. FRANCHISEE shall open the Center within nine (9) months of the date of this Agreement.
10.04. FRANCHISEE shall pay on a timely basis all of its bills and obligations; federal, state, and local and other expenses; and all taxes of the Franchised Business. FRANCHISEE shall not create or incur any expenses chargeable to COMPANY without COMPANY's prior written approval.
10.05. FRANCHISEE shall maintain the standard practices and image developed by COMPANY as the same may be changed from time to time by COMPANY, in order to maintain uniformity with other franchisees utilizing the Marks, and shall use only those standard methodologies, protocols, forms, stationery, and printed material of a style uniformly prescribed by COMPANY for its franchisees and of a quality that meets the standards uniformly prescribed by COMPANY.
10.06. FRANCHISEE shall conduct continuing local advertising in form, content, and media approved by COMPANY in a minimum amount set forth in Section 6.07, depending upon location and demographics, and retain evidence of such expenditures for submission to COMPANY upon request.
10.07. FRANCHISEE shall utilize a bookkeeping service designated by COMPANY for the first six (6) months of FRANCHISEE's operation of the Franchised Business. In COMPANY's sole discretion, FRANCHISEE may use an alternate bookkeeping service approved in writing by COMPANY.
- 10.08.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, it is not possible to determine whether Brain Balance requires an Owner's Guaranty and Assumption of Franchisee's Obligations. While the document outlines various obligations and agreements the franchisee must adhere to, such as abiding by the terms of the agreement, protecting Brain Balance's brand and trademarks, and operating the business ethically and lawfully, it does not explicitly state whether a personal guarantee is required. The FDD does mention that all permanent staff must execute a Confidentiality, Non-Solicitation, and Non-Compete Agreement.
Without specific information about an Owner's Guaranty, prospective franchisees should directly ask Brain Balance whether they require a personal guarantee as part of the franchise agreement. This is a crucial aspect of the agreement, as it can significantly impact the franchisee's personal liability. Understanding the full scope of financial obligations and potential risks is essential before entering into a franchise agreement.
It is common practice in franchising for franchisors to require a personal guarantee, especially from individual owners or small business entities. This ensures that the franchisor has recourse to the franchisee's personal assets in case of default or breach of contract. Therefore, it is important for potential Brain Balance franchisees to clarify this point during their due diligence process.