Does the Jersey Mikes Development Agreement require all Principals of the Developer to execute a Guaranty and Assumption of Obligations, and if so, what exhibit contains this?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
- 23.9 By their signatures, each of Developer's Principals who sign this Agreement acknowledges and accept the duties and obligations imposed upon each of them, individually, by the terms of this Agreement. All Principals of Developer shall execute the Guaranty and Assumption of Obligations attached as Exhibit F-1 and made a part of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to Jersey Mikes's 2025 Franchise Disclosure Document, all Principals of the Developer are required to execute a Guaranty and Assumption of Obligations. This requirement is explicitly stated in Section 23.9 of Item 22, which outlines acknowledgements related to the Development Agreement.
The Guaranty and Assumption of Obligations, which each Principal must sign, is attached as Exhibit F-1 to the Development Agreement. This exhibit is made a part of the agreement, indicating its importance and legal binding nature.
For a prospective Jersey Mikes area developer, this means that all individuals considered Principals within the development entity must personally guarantee the obligations of the Development Agreement. This is a common practice in franchising, as it ensures that the franchisor has recourse to the personal assets of the Principals should the development entity fail to meet its obligations. It also underscores the importance Jersey Mikes places on the commitment and financial stability of its area developers.