What law governs the Closet Storage Concepts personal guarantee and how are disputes resolved?

According to Closet Storage Concepts' 2025 Franchise Disclosure Document, the personal guarantee signed by the Principals is governed by the same laws and dispute resolution methods outlined in the Franchise Agreement. This means that the individuals signing the guarantee agree to be bound by all the terms, provisions, and conditions of the Franchise Agreement, ensuring their commitment to the franchisee's obligations. This includes guaranteeing the franchisee's full and timely performance of all obligations, such as any debts to Closet Storage Concepts or its affiliates.

This guarantee extends to the in-term and post-termination covenants of the Franchise Agreement, including those related to confidentiality and non-competition. The Principals also agree not to change the ownership percentage of the franchisee without notifying Closet Storage Concepts and obtaining prior written consent, following their transfer procedures, and paying any required transfer fee.

For a prospective Closet Storage Concepts franchisee, this implies that the personal assets of the shareholders, general partners, members, or managers are at risk if the franchise fails to meet its financial or operational obligations. The specific governing law and dispute resolution methods would be detailed within the Franchise Agreement itself, which a potential franchisee should carefully review with legal counsel. This is a standard practice in franchising, where franchisors seek personal guarantees to ensure franchisees are fully committed to the business and to provide an additional layer of security for the franchisor.