What form is used for the Guaranty that a spouse of a Hyper Kidz Principal must execute?

The 2024 Hyper Kidz Franchise Disclosure Document (FDD) does not specify a particular form for a spousal guarantee. However, it does state that if a proposed transferee is acquiring a portion of the interest in the legal entity that is the franchisee, then the proposed transferee must execute Hyper Kidz's form of guaranty.

This implies that Hyper Kidz uses a standard guaranty form, but the FDD does not explicitly state that this form is also used for spousal guarantees. It is common practice in franchising to require guarantees from the principals of a franchisee entity to ensure the financial obligations to the franchisor are met. Often, these guarantees extend to the principal's spouse, especially in community property states, to ensure all assets are available to satisfy the guarantee.

A prospective Hyper Kidz franchisee should confirm with the franchisor whether a spousal guarantee is required and, if so, request a copy of the specific form used for the guaranty to understand the full extent of the obligations and liabilities. Understanding the terms of the guaranty is crucial, as it can have significant financial implications for the franchisee and their spouse.