factual

Does Deck Medic require the franchisee to personally guarantee the financial obligations of the Franchisee?

Deck_Medic Franchise · 2024 FDD

Answer from 2024 FDD Document

monetary sums from Franchisee, such actions do not constitute a waiver or acceptance of Franchisee's default or breach, and Franchisor reserves the right to pursue any and all additional remedies set forth in this Agreement, at law, or in equity. Franchisor's rights and remedies are cumulative, and no exercise or enforcement by Franchisor of any such right or remedy precludes the exercise or enforcement by Franchisor of any other right or remedy which Franchisor is entitled by law to enforce.

16.D. GUARANTY

The payment of all payments, amounts, fees, charges and other financial obligations payable by Franchisee to Franchisor pursuant to this Agreement, and Franchisee's observance and performance of all terms and conditions of this Agreement, are guaranteed pursuant to The Franchise Owner and Spouse Agreement and Guaranty attached to this Agreement as Exhibit 1.

16.E. NOTICE OF LEGAL PROCEEDINGS AGAINST FRANCHISOR

Franchisee shall give Franchisor advance written notice of Franchisee's intent to commence or otherwise institute any legal action or proceeding against Franchisor, specifying the basis for such proposed action, and Franchisee shall grant Franchisor 30 days from receipt of said notice to cure the alleged act upon which such legal action is to be based (hereinafter, the "30 Day Cure Notice"). Franchisee agrees that the 30 Day Cure Notice is a strict condition precedent to Franchisee commencing, or otherwise instituting, legal action or proceeding against Franchisor for any reason whatsoever.

ARTICLE 17 OBLIGATIONS UPON TERMINATION OR EXPIRATION

17.A. PAYMENT OF AMOUNTS OWED TO FRANCHISOR

Without limitation as to any other Article or provision of this Agreement, upon expiration or termination of this Agreement for any reason, Franchisee shall immediately pay to Franchisor all sums and fees due from Franchisee to Franchisor under the terms of this Agreement including, but not limited to Royalty Fees and Advertising Contributions and all other sums and fees due from Franchisee to Franchisor and/or

Franchisor affiliates and/or suppliers for products and services including, but not limited to, System Supplies.

17.B. CEASE OPERATIONS AND PROTECTION OF THE SYSTEM

Upon expiration, termination, or Transfer of this Agreement for any reason, Franchisee shall immediately:

  • (1) Permanently cease to be a franchise owner of the Deck Medic Business that was the subject of this Agreement and cease to operate such Deck Medic Business under the System;
  • (2) Refrain from directly or indirectly, holding oneself/itself out to any person or entity, or represent themselves/itself as a present or former Deck Medic franchisee;
  • (3) Permanently cease to use, in any manner: (a) the System including, without limitation, the Confidential Information, the Licensed Marks, the Business Management System Data, and the Operations Manual; (b) any methods, procedures, or techniques associated with the System in which Franchisor possesses proprietary rights or that constitute Franchisor's trade secrets; (c) System Supplies, including communicating with or ordering products from Franchisor's designated suppliers and vendors of System Supplies; (d) the Approved Services and Products; and (e) any other advertising, marketing, media, and any other information, documents or things associated with Franchisor, the System, the Licensed Marks, Deck Medic Businesses, the Franchised Business, and Franchisee's former Deck Medic Business, including, without limitation, any confidential, proprietary methods, procedures, descriptions of products, techniques, trade secrets, proprietary marks, distinctive forms, slogans, symbols, signs, stationary, advertising material, articles, logos, devices, items and all other things, tangible or intangible, associated with Franchisor, the System, the Licensed Marks, and Deck Medic Businesses;
  • (4) Return to Franchisor the Operations Manual (including any and all parts, supplements, and copies of the Operations Manual), the Confidential Information (including without limitation the Business Management System Data and all customer lists and information), and all other confidential materials, equipment, software, information, and property owned by Franchisor and all copies thereof provided, however, that Franchisee may retain Franchisee's copies of this Agreement, correspondence between Franchisor and Franchisee, but not including Confidential Information that may be contained in or attached thereto, and other documents that Franchisee needs to retain pursuant to applicable law;
  • (5) Permanently cease accessing, immediately disconnect from, and discontinue using any and all digital media, intra-nets, cloud based systems, and/or servers that store, maintain, and/or provide access to the Operations Manual, Confidential Information, and all other standards, specifications of Franchisor;
  • (6) Immediately notify Franchisor, in writing, of any and all locations where Franchisee may have maintained and/or stored digital files and/or media containing all or parts of the Operations Manual, any Confidential Information, and all other standards and specifications of Franchisor, immediately turn over such digital files and media to Franchisor, and follow Franchisor's instructions as to the destruction of such digital files and media;

Source: Item 23 — RECEIPTS (FDD pages 43–228)

What This Means (2024 FDD)

According to Deck Medic's 2024 Franchise Disclosure Document, the franchisee's financial obligations to Deck Medic are guaranteed. Specifically, if the franchisee is a corporate entity, each owner and their spouse must sign a Franchise Owner and Spouse Agreement and Guaranty, which includes a guarantee of the franchisee's obligations. This means that individuals associated with a corporate franchisee are personally liable for the financial performance of the franchise.

This requirement is further detailed in the section concerning transfers of the franchise agreement. If the franchisee dies or becomes permanently disabled, a transfer of the agreement to a designated person, heir, or beneficiary is possible. However, this transfer is contingent upon the transferee agreeing to be unconditionally bound by the terms of the agreement and personally guaranteeing the franchisee's obligations. The transferee must also execute the Franchise Owner and Spouse Agreement and Guaranty.

The FDD also states that upon termination or expiration of the franchise agreement, the franchisee must immediately pay all sums and fees due to Deck Medic. Given the personal guarantee, this obligation extends to the individuals who signed the Franchise Owner and Spouse Agreement and Guaranty, ensuring Deck Medic can pursue them directly for any outstanding debts.

This personal guarantee is a significant commitment for Deck Medic franchisees and their spouses. It means their personal assets are at risk if the franchise fails to meet its financial obligations. Prospective franchisees should carefully consider this aspect and seek legal and financial advice before entering into a franchise agreement with Deck Medic.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.