What specific obligations of the Franchisee's Principal does the Guarantor agree to uphold in the Kidokinetics Franchise Agreement?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Guarantor acknowledges that Guarantor is included in the term "Franchisee's Principal" as described in the Franchise Agreement.
Guarantor acknowledges that Guarantor has read the terms and conditions of the Franchise Agreement and acknowledges that the execution of this Guaranty and the undertakings of the Franchisee's Principal herein and in the Franchise Agreement are in partial consideration for, and a condition to the granting of, the rights granted in the Franchise Agreement, and that Franchisor would not have granted these rights without the execution of this Guaranty by Guarantor.
Guarantor hereby individually makes, agrees to be bound by, and agrees to perform, all of the covenants, representations, warranties and agreements of the Franchisee's Principal as set forth in the Franchise Agreement, including all obligations regarding non-competition and confidentiality.
Guarantor does hereby guarantee to Franchisor the prompt payment and performance when due of any and all liabilities and obligations arising under or evidenced by the Franchise Agreement, any promissory note or other credit instruments, and any other liabilities, obligations and indebtedness of Franchisee and/or any of its assignees or affiliates to Franchisor and/or any of its assignees or affiliates, of every kind and description, now existing or hereafter incurred or arising, matured or unmatured, direct or indirect, absolute or contingent, due or to become due, and any renewals, consolidations and extensions, including any future advances from Franchisor to Franchisee (collectively, the "Guaranteed Obligations"). Guarantor shall perform and/or make punctual payment to Franchisor of the Guaranteed Obligations in accordance with the terms of the Franchise Agreement or other applicable document forthwith upon demand by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, the Guarantor, who is included in the term "Franchisee's Principal," agrees to be bound by and perform all covenants, representations, warranties, and agreements of the Franchisee's Principal as outlined in the Franchise Agreement. This encompasses all obligations related to non-competition and confidentiality.
Furthermore, the Guarantor guarantees the prompt payment and performance of all liabilities and obligations arising under the Franchise Agreement, any promissory note or other credit instruments, and any other liabilities, obligations, and indebtedness of the Franchisee or its assignees or affiliates to Kidokinetics or its assignees or affiliates. These Guaranteed Obligations cover all debts and duties, whether existing now or in the future, matured or unmatured, direct or indirect, absolute or contingent, due or to become due, including any renewals, consolidations, extensions, and future advances from Kidokinetics to the Franchisee.
In practical terms, this means that the Guarantor is stepping in to ensure that Kidokinetics receives all payments and that all terms of the Franchise Agreement are met, as if the Guarantor were the Franchisee. This arrangement provides Kidokinetics with an additional layer of security, knowing that there is a responsible party committed to fulfilling the financial and operational obligations of the franchise. Prospective franchisees should carefully review the Guaranty agreement to fully understand the scope of these obligations and potential liabilities.