Does the 1-800-GOT-JUNK? Guarantor's obligation include costs for the Franchisor's counsel's reasonable expenses?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
ll 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: 4934-9833-2741.1
- 2 - (a) guaranty the full and punctual payment and performance of all present and future obligations, liabilities, covenants and agreements required to be observed and performed or paid or reimbursed by the Guarantor under or relating to the Franchise Agreement, plus all costs, expenses and fees (including the reasonable fees and expenses of the Franchisor's counsel) in any way relating to the enforcement or protection of Franchisor's rights hereunder, including without limitation, (i) royalty, minimum royalty, marketing royalty, amounts owing for products and inventory purchased by the Franchisee, rent, additional rent, monies, charges and other amounts of any kind whatsoever payable by the Franchisee to the Franchisor pursuant to any agreements or dealings between the Franchisee and the Franchisor, and (ii) the prompt and complete performance of any and all terms, covenants and conditions on the part of the Franchisee to be kept, observed and performed under any agreements or dealings between the Franchisee and the Franchisor, including without limitation the terms, covenants and conditions on the part of the Franchisee to be kept, observed and performed under the Franchise Agreement; and (b) indemnify and save harmless the Franchisor from any loss, costs or damages arising out of any failure by the Franchisee to observe or perform any and all of the terms, covenants and conditions contained in the Franchise Agreement, (collectively the “Obligations”).
Source: Item 22 — Contracts (FDD page 24)
What This Means (2025 FDD)
According to the 2025 1-800-GOT-JUNK? Franchise Disclosure Document, the Guarantor's obligations include covering the franchisor's legal expenses. Specifically, the guarantor is responsible for the full and punctual payment and performance of all obligations and agreements required by the franchisee. This extends to all costs, expenses, and fees, including the reasonable fees and expenses of 1-800-GOT-JUNK?'s counsel. These expenses must relate to the enforcement or protection of 1-800-GOT-JUNK?'s rights under the franchise agreement.
This obligation includes, but isn't limited to, royalty, minimum royalty, marketing royalty, and amounts owed for products and inventory purchased by the franchisee. It also covers rent, additional rent, monies, charges, and other amounts payable by the franchisee to 1-800-GOT-JUNK? under any agreements. The guarantor must also ensure the prompt and complete performance of all terms, covenants, and conditions the franchisee is obligated to fulfill under any agreements with 1-800-GOT-JUNK?, including the franchise agreement itself.
Furthermore, the guarantor is required to indemnify and hold 1-800-GOT-JUNK? harmless from any loss, costs, or damages resulting from the franchisee's failure to observe or perform any terms and conditions outlined in the franchise agreement. The guarantor's liability to 1-800-GOT-JUNK? is considered primary, as if the guarantor were the main obligor under the franchise agreement, rather than merely a surety for the franchisee's obligations.