Are the Guarantor's liabilities independent of the Franchisee's obligations in the All County Franchise Agreement?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.3. such liability will not be contingent or conditioned upon our pursuit of any remedies against Franchisee or any other person; and
- 3.4. such liability will not be diminished, relieved or otherwise affected by any extension of time, credit or other indulgence which we 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 will in any way modify or amend this Guaranty, which will be continuing and irrevocable during the Term of the Agreement and thereafter.
- 3.5. This Guaranty shall be binding on each Guarantor and his respective successors and assigns, and shall inure to our benefit and the benefit our successors and assigns. The Guarantor may not assign his obligations hereunder without our prior written consent.
The obligations of Franchisee and Guarantor, as described herein and in the Agreement, shall not be considered fully paid, performed and discharged unless and until all payments by Franchisee to us are no longer subject to any right on the part of any person to set aside such payments or to seek to recoup the amount of such payments. The foregoing shall include, by way of example and not by way of limitation, all rights to recover preferences voidable under Title 11 of the United States Code. If any such payments by Franchisee to us are set aside in whole or in part after being made, or are settled without litigation, to the extent of such settlement, all of which is in our business judgment, the Guarantor shall be liable, jointly and severally for the full amount of our costs, interest, attorney's fees and any and all expenses which we pay or incur in connection therewith.
- WAIVERS. Each Guarantor waives all rights to payments and claims for reimbursement or subrogation which any of the Guarantor may have against Franchisee arising as a result of the Guarantor's execution of and performance under this Guaranty.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, the Guarantor's liabilities are indeed independent of the Franchisee's obligations. The Guaranty states that the Guarantor's liability is not contingent or conditional upon All County pursuing remedies against the Franchisee or any other person. This means All County can seek recourse from the Guarantor without first having to exhaust all options against the Franchisee.
Furthermore, the Guarantor's liability will not be affected by any extensions of time, credit, or other allowances All County might grant to the Franchisee. This includes accepting partial payments, performance, or compromising or releasing claims. None of these actions will modify or amend the Guaranty, which remains continuous and irrevocable during the term of the agreement and thereafter. This protects All County by ensuring the guaranty remains in effect even if the terms of the agreement with the franchisee are adjusted.
The Guaranty is binding on each Guarantor, their successors, and assigns, and benefits All County and its successors and assigns. The Guarantor cannot assign their obligations without All County's prior written consent. Additionally, the obligations of the Franchisee and Guarantor are not considered fully discharged until all payments by the Franchisee are no longer subject to any rights of being set aside or recouped. If any payments from the Franchisee to All County are set aside, the Guarantor remains liable for All County's costs, interest, attorney's fees, and any expenses incurred in connection with such actions.
Finally, each Guarantor waives all rights to payments and claims for reimbursement or subrogation against the Franchisee arising from the Guarantor's execution and performance under the Guaranty. This waiver further solidifies the independence of the Guarantor's obligations from those of the Franchisee, ensuring that All County's interests are protected.