Besides the owner, who else might Stretch Zone require to execute the Guaranty?

According to Stretch Zone's 2025 Franchise Disclosure Document, if the franchisee or developer is a business entity, each owner with a direct or indirect interest of 20% or more in the franchisee/developer must sign the applicable Guaranty. This means that if the Stretch Zone franchise is owned by a corporation, LLC, or other business entity, individuals holding significant ownership stakes (20% or greater) are required to personally guarantee the franchise agreement. This is a common practice in franchising, as it ensures that individuals with a substantial financial interest in the business are personally liable for its obligations.

In addition to owners with a 20% or greater interest, Stretch Zone may also request that the spouse of each guaranteeing owner execute the Guaranty. This provision aims to protect Stretch Zone by ensuring that marital assets could be accessible in the event of a default. This is also a fairly common practice, as it prevents owners from shielding assets by transferring them to their spouse.

For a prospective Stretch Zone franchisee, this requirement means that if you are setting up a business entity to operate the franchise, be prepared for yourself, any co-owners with significant equity, and potentially your spouse to sign a personal guarantee. This is a significant legal and financial commitment, as it puts your personal assets at risk if the franchise fails. It is crucial to fully understand the implications of the Guaranty and seek legal counsel before signing any franchise agreement.