What actions are prohibited under the guarantee agreement for a 1-800-GOT-JUNK? franchise?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS:
A. By a Franchise Agreement made effective the effective date hereof (the “Franchise Agreement”), the Franchisor granted a licence to ____________________ (the “Franchisee”) for the establishment and operation of a retail business offering junk removal services under the name “1-800- GOT-JUNK?”.
B. In order to induce the Franchisor to enter into the Franchise Agreement with the Franchisee, the Guarantor has agreed to execute and deliver this Agreement.
C. The Guarantor, who is a shareholder (directly or indirectly), director, officer, member or partner of the Franchisee and thereby benefits from the Franchise Agreement and stands to benefit from the grant of the licence to the Franchisee, has agreed to execute and deliver this Agreement.
D. Capitalized terms used but not defined in this Agreement shall have their respective meanings as defined the Franchise Agreement.
THIS AGREEMENT WITNESSES that in consideration of the Franchisor entering into the Franchise Agreement and other good and valuable consideration (the receipt and sufficiency whereof is hereby acknowledged by the Guarantor), the Guarantor covenants and agrees with and in favor of the Franchisor as follows:
PART 1 - GUARANTEE
1. The Guarantor warrants that the facts contained in Recitals A, B, and C are correct.
2. The Guarantor shall at all times during the term of the Franchise Agreement and during any exercised extension or renewal of the term of the Franchise Agreement and until all of the terms, covenants and conditions of all agreements and dealings between the Franchisee and the Franchisor have been fully and completely performed by the Franchisee or otherwise discharged by the Franchisor:
Source: Item 22 — Contracts (FDD page 24)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the guarantee agreement for a 1-800-GOT-JUNK? franchise outlines the responsibilities and obligations of the guarantor, who is typically a shareholder, director, officer, member, or partner of the franchisee. The guarantor benefits from the franchise agreement and the grant of the license to the franchisee, and thus agrees to execute and deliver the guarantee agreement. The agreement ensures that the guarantor will fulfill the franchisee's obligations to the franchisor.
The guarantor warrants that all facts contained in the recitals of the agreement are correct. The guarantor is bound to fulfill all terms, covenants, and conditions of all agreements and dealings between the franchisee and 1-800-GOT-JUNK? until these obligations are fully performed or discharged by the franchisor. This includes any extensions or renewals of the franchise agreement's term.
The guarantor also makes several representations and warranties to 1-800-GOT-JUNK?, including that no external representations or agreements limit or qualify the terms of the guarantee agreement. The guarantor confirms that they are entering into the agreement voluntarily and possess the full authority to do so. These provisions ensure that the franchisor has recourse to the guarantor's assets and commitment in case the franchisee fails to meet its obligations, providing an additional layer of security for 1-800-GOT-JUNK?.