Is the Cream guaranty form attached to the Franchise Agreement?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are a legal business entity, each of your direct and indirect owners with a 10% or greater ownership interest in you must execute a guaranty in the form personally to be bound, jointly and severally, by all provisions of the Franchise Agreement and any ancillary agreements between you and us. Our current form of guaranty is attached as Attachment D to the Franchise Agreement. If any owner is an individual, his or her spouse must consent in writing to that owner's execution of the guaranty.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 42–43)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the current form of guaranty that Cream uses is included as Attachment D to the Franchise Agreement. If the franchisee is a legal business entity, each direct and indirect owner with a 10% or greater ownership interest must execute this guaranty. This ensures that these owners are personally bound by the Franchise Agreement's provisions and any related agreements between the franchisee and Cream.
If any owner is an individual, their spouse must provide written consent to the owner's execution of the guaranty. This spousal consent requirement is designed to ensure that both spouses are aware of and agree to the financial obligations and potential liabilities associated with the franchise. This is a common practice to protect marital assets and prevent future disputes.
Attachment D itself is titled "GUARANTY AND ASSUMPTION OF OBLIGATIONS" and specifies that each person signing the Guaranty (the "Guarantor") is effective as of the Franchise Agreement's effective date. Each Guarantor personally and unconditionally guarantees that the Franchise Owner will fulfill every agreement and covenant in the Franchise Agreement. The Guarantor also agrees to be personally bound by and liable for any breaches of the agreement, including monetary obligations and specific actions or inactions related to non-competition, confidentiality, and transfer requirements.