Under the Anago franchise agreement, does the taking or releasing of other or additional security affect the liability of the endorsers or guarantors of the Note?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
- i.
Your liability hereunder will not be diminished, relieved or otherwise affected by any extension of time, credit or other indulgence, or any waiver that FRANCHISOR may from time to time grant to SUBFRANCHISOR or to any other person, including without limitation, the acceptance of any partial payment or performance, or the compromise or release of any claims (including the release of other owners or guarantors), or the taking of any action by FRANCHISOR which may have the effect of increasing your obligations, none of which will in any way modify or amend this Guaranty, which will be continuing and irrevocable during the term of the Franchise Agreement and so long as any performance is or may be owed under any of the Anago Agreements by SUBFRANCHISOR or its owners and so long as FRANCHISOR may have any cause of action against SUBFRANCHISOR or its owners; and
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the liability of endorsers or guarantors is not affected by the taking or releasing of other or additional security. Specifically, the guaranty provided remains in effect regardless of actions taken by Anago that might alter the guarantor's obligations.
This means that as a guarantor, your obligations remain constant and are not reduced or eliminated if Anago provides any extension of time, credit, or indulgence to the franchisee. This also applies if Anago accepts partial payments, compromises claims, or releases other owners or guarantors. Even actions that might increase your obligations as a guarantor do not modify or amend the guaranty, which remains continuous and irrevocable during the term of the Franchise Agreement.
Furthermore, the guarantor's obligations are not contingent upon Anago pursuing remedies against the franchisee or any other person. The guarantor waives any right to require Anago to take action against the franchisee as a condition of liability. This underscores the comprehensive and unconditional nature of the guaranty, ensuring that Anago can rely on the guarantor's commitment regardless of other circumstances or actions taken.
This clause is designed to protect Anago by ensuring that the guaranty remains a solid and unchanging commitment, irrespective of any changes in the financial arrangements or legal actions involving the franchisee. Prospective guarantors should fully understand this aspect of the agreement, as it places a significant responsibility on them to cover the franchisee's obligations under various circumstances.