Is the 1 800 Packouts Guaranty continuing and irrevocable during the term of the Agreement?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
Each of the undersigned consents and agrees that: (1) his direct and immediate liability under this guaranty shall be joint and several; (2) he shall render any payment or performance required under the Agreement upon demand if Franchisee fails or refuses punctually to do so; (3) such liability shall not be contingent or conditioned upon pursuit by Franchisor of any remedies against Franchisee or any other person; and (4) such liability shall not be diminished, relieved or otherwise affected by an extension of time, credit or other indulgence which Franchisor may from time to time grant to Franchisee or to any other person, including without limitation, the acceptance of any partial payment or performance, or the compromise or release of any claims, none of which shall in any way modify or amend this guaranty, which shall be continuing and irrevocable during the term of the Agreement.
Each of the undersigned waives all rights to payments and claims for reimbursement or subrogation which any of the undersigned may have against Franchisee arising as a result of the undersigned's execution of and performance under this guaranty.
If Franchisor is required to enforce this guaranty in a judicial or arbitration proceeding, and prevails in such proceeding, it shall be entitled to reimbursement of its costs and expenses, including, but not limited to, reasonable accountants', attorneys', attorneys' assistants', arbitrators' and expert witness fees, costs of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses, whether incurred prior to, in preparation for or in contemplation of the filing of any such proceeding. If Franchisor is required to engage legal counsel in connection with any failure by the undersigned to comply with this guaranty, the undersigned shall reimburse Franchisor for any of the above-listed costs and expenses incurred by it.
Guarantor agrees to be personally bound by the dispute resolution obligations under Section 17 of the Agreement.
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the guaranty signed by the franchisee is designed to be ongoing and cannot be revoked while the Franchise Agreement is in effect. This means that the guarantor's obligations remain in place for the entire duration of the agreement.
The guarantor's liability is direct, immediate, and joint and several, meaning 1 800 Packouts can seek payment or performance directly from the guarantor without first pursuing the franchisee. This obligation is triggered if the franchisee fails to meet their obligations under the agreement. The guarantor's liability is not contingent on 1 800 Packouts pursuing other remedies against the franchisee or any other party.
Furthermore, the guarantor's obligations are not affected by any extensions of time, credit, or other allowances that 1 800 Packouts may grant to the franchisee. This includes accepting partial payments or compromising claims. The guarantor also waives any rights to payments or claims for reimbursement against the franchisee that may arise from fulfilling their obligations under the guaranty.
If 1 800 Packouts has to take legal action or arbitration to enforce the guaranty and wins, the guarantor is responsible for covering all associated costs and expenses. These include reasonable accountant, attorney, arbitrator, and expert witness fees, as well as costs related to investigation, proof of facts, court costs, litigation expenses, and travel and living expenses. The guarantor also agrees to adhere to the dispute resolution obligations outlined in Section 17 of the Franchise Agreement.