What happens if a Deka Lash franchisee admits inability to pay debts?
Deka_Lash Franchise · 2024 FDDAnswer from 2024 FDD Document
In addition, the signatures of all individuals below, in any capacity, including spouses, also constitute their personal joint and several agreement to perform all the obligations in and relating to this Agreement, including, but not limited to, the obligations stated in Paragraphs 11-13 above, the obligation to make specified payments, and pay any other debts due to us. Each Guarantor agrees to guarantee us against all liability, loss, harm, damage, costs, and expenses (including attorney fees) that we may incur because of your failure to observe your obligations. The liabilities and obligations of each Guarantor will not be released, discharged, or affected by our release or discharge of or dealing with you under any of these agreements; or by anything we do, suffer, or allow to be done in relation to you; or by change, alteration, or modification of any of the agreements; or by any compromise, arrangement, or plan of reorganization affecting you; or by your bankruptcy or insolvency; or by any other act or proceeding in relation to you or any of the agreements by which any Guarantor might otherwise be released. The liabilities and obligations of each Guarantor pursuant to this Guarantee will be continuing in nature and will terminate only on the satisfaction of your obligations under this Agreement. All Signators below waive any right to presentment, demand, notice of non-performance, or the right to require us to proceed against the other Signators.
Source: Item 23 — RECEIPT (FDD pages 63–234)
What This Means (2024 FDD)
I am unable to provide information about the specific consequences a Deka Lash franchisee might face if they admit an inability to pay debts, according to the 2024 Franchise Disclosure Document. While the document includes a general release and discusses financial obligations, it does not detail the specific actions or repercussions that Deka Lash would take if a franchisee were to admit an inability to pay their debts. The FDD does mention the franchisee's obligation to make specified payments and pay any other debts due to the franchisor. It also states that guarantors agree to guarantee against all liability, loss, harm, damage, costs, and expenses (including attorney fees) that the franchisor may incur because of the franchisee's failure to observe their obligations.
To fully understand the potential ramifications, prospective Deka Lash franchisees should carefully review the franchise agreement and related documents with a legal and financial advisor.
Specifically, a prospective franchisee should ask Deka Lash's franchisor directly about the policies and procedures in place if a franchisee experiences financial difficulties and is unable to meet their financial obligations. This information is crucial for making an informed decision about investing in a Deka Lash franchise.