Under the Learningrx Area Developer Agreement, what does the guaranty provided by the Guarantors cover?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
GUARANTY
| In consideration of, and as an inducement to, the execution of that certain Area | ||||
|---|---|---|---|---|
| Development Agreement, and any revisions, modifications, addenda and amendments thereto, (hereinafter collectively the "Agreement") dated, by and between | ||||
| LearningRx | Franchise | a | corporation, | ("Franchisor") |
| Corporation, | Colorado | and ("Area Developer"), each of the undersigned Guarantors agrees as | ||
| follows: |
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- The Guarantors do hereby jointly and severally unconditionally guaranty the full, prompt and complete performance of the Area Developer under the terms, covenants and conditions of the Agreement, including without limitation, compliance with all confidentiality requirements, protection and preservation of confidential information, compliance with all noncompete provisions, compliance with the terms of any and all other agreements executed by Area Developer in order to open and operate the Center, and the complete and prompt payment of all indebtedness to Franchisor under the Agreement. The word "indebtedness" is used herein in its most comprehensive sense and includes without limitation any and all advances, debts, obligations and liabilities of the Area Developer, now or hereafter incurred, either voluntarily or involuntarily, and whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, or whether recovery thereof may be now or hereafter barred by any statute of limitation or is otherwise unenforceable.
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- The obligations of the Guarantors are independent of the obligations of the Area Developer and a separate action or actions may be brought and prosecuted against any or all of the Guarantors, whether or not actions are brought against the Area Developer or whether the Area Developer is joined in any such action.
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Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, the Guarantors jointly and severally provide an unconditional guaranty of the Area Developer's full and prompt performance under the Area Developer Agreement. This includes compliance with confidentiality requirements, protection of confidential information, adherence to non-compete provisions, and compliance with all agreements executed by the Area Developer to open and operate a Learningrx center. The guaranty also covers the complete and prompt payment of all indebtedness to Learningrx under the Agreement.
The term "indebtedness" is broadly defined to include all advances, debts, obligations, and liabilities of the Area Developer, whether incurred voluntarily or involuntarily, and whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined. This also applies regardless of whether recovery may be barred by any statute of limitation or is otherwise unenforceable.
The obligations of the Guarantors are independent of the Area Developer's obligations, meaning Learningrx can pursue action against the Guarantors without first pursuing action against the Area Developer. Learningrx is not obligated to investigate the authority of the Area Developer or its representatives, and any obligation or indebtedness created in reliance on such authority is guaranteed. If the Guarantors are corporations, LLCs, or partnerships, it is presumed that they have the authority to bind the entity and that acting as a Guarantor promotes the business interest of the entity.