Does the B Bops agreement allow the company to grant extensions to the franchisee without affecting the guarantor's liability?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
Each of the undersigned further agree as follows: (a) that this Guaranty shall be continuing and irrevocable; (b) that they, and each of them, shall render any payment or performance required under this Agreement upon demand if Franchisee fails or refuses promptly to do so; (c) such liability shall be primary and shall not be contingent upon Company pursuing or exhausting any remedies against Franchisee; (d) such liability shall not be waived, diminished or otherwise affected by any extension of time, credit or other indulgence which Company may from time to time grant to Franchisee; and (e) that they, and each of them, hereby waive notice of acceptance, demand, protest, nonperformance and of any other notices.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, the personal guaranty agreement stipulates that the guarantor's liability will not be affected by any extensions of time that B Bops may grant to the franchisee. This means that even if B Bops provides the franchisee with additional time to meet their obligations, the guarantor remains fully responsible for the franchisee's debts and performance under the franchise agreement.
This provision protects B Bops by ensuring that the guarantor's obligations remain in place regardless of any leniency the company might extend to the franchisee. It also means that the guarantor cannot claim that their liability is reduced or eliminated due to any extensions granted to the franchisee.
For a prospective B Bops franchisee, this highlights the importance of carefully considering who will act as a personal guarantor, as their financial responsibility will persist even if the franchisor provides the franchisee with some flexibility. The guarantor should be fully aware of the franchisee's business plan and financial capabilities, as they are taking on a significant risk.