Does the Guaranty agreement for the Cream franchise impose any required actions on the Guarantor?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
tion 15D or determining whether to do so | |
ATTACHMENT C TO FRANCHISE AGREEMENT
PREMISES AND PROTECTED TERRITORY
| sell any products and services of any kind and in any manner from | your | Shop and/or using the | |
|---|---|---|---|
| Marks, unless we direct you otherwise in connection with our exercise of our option to purchase |
ATTACHMENT D TO FRANCHISE AGREEMENT
GUARANTY AND ASSUMPTION OF OBLIGATIONS
THIS GUARANTY AND ASSUMPTION OF OBLIGATIONS is given by each of the undersigned persons indicated below who have executed this Guaranty (each a "Guarantor") to be effective as of the Effective Date of the Agreement (defined below).
In consideration of, and as an inducement to, the execution of that certain Franchise Agreement (the "Agreement") on this date by Jeni's Splendid Ice Creams Franchise, LLC ("us," "we," or "our"), each Guarantor personally and unconditionally (a) guarantees to us and our successors and assigns, for the term of the Agreement and afterward as provided in the Agreement, that ________________________________________ ("Franchise Owner") will punctually pay and perform each and every undertaking, agreement, and covenant set forth in the Agreement and (b) agrees to be personally bound by, and personally liable for the breach of, each and every provision in the Agreement, both monetary obligations and obligations to take or refrain from taking specific actions or to engage or refrain from engaging in specific activities, including the non-competition, confidentiality, and transfer requirements.
Each Guarantor consents and agrees that: (1) Guarantor's direct and immediate liability under this Guaranty will be joint and several, both with Franchise Owner and among other guarantors; (2) Guarantor will render any payment or performance required under the Agreement upon demand if Franchise Owner fails or refuses punctually to do so; (3) this liability will not be contingent or conditioned upon our pursuit of any remedies against Franchise Owner or any other person;
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the Guaranty and Assumption of Obligations agreement does impose required actions on the Guarantor. Each Guarantor must personally and unconditionally guarantee that the Franchise Owner will punctually pay and perform every undertaking, agreement, and covenant in the Franchise Agreement. The Guarantor also agrees to be personally bound by and liable for any breaches of the Franchise Agreement, including monetary obligations and obligations to take or refrain from specific actions.
Furthermore, the Guarantor must render any payment or performance required under the Franchise Agreement upon demand if the Franchise Owner fails or refuses to do so punctually. This liability is not contingent upon Cream pursuing remedies against the Franchise Owner. The Guarantor's obligations remain in effect despite any extensions of time, credit, or other indulgences granted to the Franchise Owner. At Cream's request, the Guarantor must also present updated financial information to demonstrate their ability to satisfy the financial obligations of the Franchise Owner under the agreement.
These stipulations mean that anyone acting as a Guarantor for a Cream franchise must be prepared to step in and fulfill all financial and operational obligations of the franchisee if they default. The Guarantor's personal assets are at risk, and they must maintain sufficient financial stability to cover the franchise's obligations. Additionally, the requirement to provide updated financial information allows Cream to monitor the Guarantor's ongoing ability to support the franchise, adding another layer of scrutiny and potential action required from the Guarantor.