Does Coffee News require a personal guaranty of performance from the franchisee?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
As the owner of the franchise(s), you are responsible for the compliance of all employees with the terms and conditions of the Franchise Agreement including your manager, on- premises supervisor or minority stockholder, if a company. If the franchisee is a company, there is no minimum equity interest required that the on-premises supervisor must have in the company. We do not impose any restriction that you must place on your managerial staff. You may, however, require a non-compete of all employees and a non-disclosure of trade secrets.
We place no other limitations or restrictions on your staff other than those contained in the Item 17. We do not require a personal guaranty of the performance.
Source: Item 15 — Obligation to Participate in the Actual Operation of the Franchise Business (FDD pages 24–25)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, Coffee News does not require a personal guaranty of performance from its franchisees. As the owner of the franchise, the franchisee is responsible for the compliance of all employees with the terms and conditions of the Franchise Agreement, including a manager, on-premises supervisor, or minority stockholder if the franchisee is a company. There is no minimum equity interest required for an on-premises supervisor.
Coffee News does not impose any restrictions that the franchisee must place on their managerial staff, but the franchisee may require a non-compete agreement and a non-disclosure of trade secrets from all employees.
This policy provides a benefit to the franchisee, as they will not be held personally liable for the business's performance. This is less stringent than some franchise systems, which often require a personal guarantee to ensure the franchisee is fully committed to the business and to provide the franchisor with additional security.