Are Face Foundrie franchisees required to sign a personal guaranty?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisees must sign a personal guaranty, making you and your spouse individually liable for your financial obligations under the agreement if you are married.
The guaranty will place your and your spouse's marital and personal assets at risk, perhaps including your house, if your franchise fails.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION OF THE FRANCHISE RELATIONSHIP (FDD pages 51–59)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, franchisees are required to sign a personal guaranty. This means that the franchisee, and their spouse if married, become individually liable for the financial obligations under the Franchise Agreement. This requirement is fairly common in franchising, as it provides the franchisor with additional security.
The personal guaranty places the franchisee's and their spouse's personal assets at risk, potentially including their house, if the Face Foundrie franchise fails. This is a significant risk that prospective franchisees should carefully consider. It is important to fully understand the financial obligations outlined in the Franchise Agreement and to assess the potential impact on personal assets.
Given the implications of a personal guaranty, prospective Face Foundrie franchisees should seek legal and financial advice before signing the Franchise Agreement. Understanding the full extent of the personal liability and exploring options for mitigating the risk are crucial steps in the due diligence process. Franchisees should also inquire about the conditions under which the guaranty may be enforced and whether there are any possibilities for release or modification of the guaranty over time.