Is the All County Guaranty continuing and irrevocable during the term of the agreement and thereafter?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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.
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, the Guaranty signed by each owner is continuing and irrevocable during the term of the agreement and thereafter. Specifically, the liability of the guarantor is not contingent on All County pursuing remedies against the franchisee or any other person. This means All County can seek recourse directly from the guarantor without first exhausting other options. The guarantor's liability also remains unaffected by any extensions of time, credit, or other allowances All County might grant to the franchisee. This includes accepting partial payments or compromising claims, none of which modify the Guaranty.
The Guaranty is binding on each guarantor, their successors, and assigns, and it benefits All County, its successors, and assigns. The guarantor cannot assign their obligations without All County's prior written consent. This ensures that the obligations under the Guaranty remain with the original guarantor unless All County explicitly approves a transfer.
Furthermore, the obligations of the franchisee and guarantor are not considered fully discharged until all payments to All County are no longer subject to any rights of set-aside or recoupment, including rights to recover preferences voidable under Title 11 of the United States Code (bankruptcy code). If any payments are set aside or settled, the guarantor remains liable for All County's costs, interest, attorney's fees, and any expenses incurred in connection with such actions. This clause protects All County in the event of the franchisee's financial instability or bankruptcy, ensuring that the guarantor remains responsible for any shortfalls or legal costs incurred by All County.