What is the significance of the Guarantors signing the Baymont Inn Suites Guaranty?
Baymont_Inn_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
To induce Baymont Franchise Systems, Inc., its successors, assigns, and affiliates ("Company") to consent to the assignment and assumption of the Primary Agreements (as defined in the Assignment and Assumption Agreement (the "Agreement") to which this Guaranty is attached), the undersigned, personally, jointly and severally ("we, "our" or "us") irrevocably and unconditionally (i) warrant to Company that Assignee's representations and warranties in the Agreement and in the Franchise Agreement are true and correct as stated; and (ii) guaranty that all of Franchisee's obligations under the Primary Agreements will be punctually paid and performed, from and after the time Assignee becomes the Franchisee under the Franchise Agreement. Capitalized terms not defined in this Guaranty have the meanings given to them in the Agreement.
Upon default by Franchisee and notice from Company, we will immediately make each unpaid payment and perform, or cause Franchisee to perform, each unperformed obligation of Franchisee under the Primary Agreements. Without affecting our obligations under this Guaranty, without notice to us, Company may extend, modify or release any indebtedness or obligation of Franchisee, or settle, adjust or compromise any claims against Franchisee. We waive notice of amendment of the Agreements. We acknowledge that the provisions of Section 17 of the Franchise Agreement, including but not limited to Section 17.4 (Remedies) and Section 17.6 (Choice of Law; Venue; Dispute Resolution, including but not limited to Section 17.6.4 (Waiver of Jury Trial)), apply to this Guaranty.
Upon the death of an individual guarantor, the estate of the guarantor will be bound by this Guaranty for obligations of Franchisee to Company existing at the time of death, and the obligations of all other guarantors will continue in full force and effect.
This Guaranty may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
Source: Item 22 — CONTRACTS (FDD pages 96–97)
What This Means (2025 FDD)
According to the 2025 Baymont Inn Suites Franchise Disclosure Document, the Guaranty is a legally binding agreement where the guarantors personally warrant the accuracy of the assignee's representations and warranties within the Assignment and Assumption Agreement and the Franchise Agreement. By signing the Guaranty, the guarantors ensure that the franchisee's obligations under the Primary Agreements will be fulfilled from the moment the assignee becomes the franchisee. This means that the guarantors are taking on a direct responsibility for the financial and operational performance of the franchise.
If the franchisee defaults on their obligations, Baymont Inn Suites can demand immediate payment or performance from the guarantors. The guarantors' obligations remain even if Baymont Inn Suites modifies or releases any of the franchisee's debts or obligations without notifying the guarantors. The Guaranty also stipulates that the provisions of Section 17 of the Franchise Agreement, including remedies, choice of law, venue, and dispute resolution (including waiver of jury trial), apply to the Guaranty. This underscores the comprehensive nature of the guarantor's commitment.
Even in the event of a guarantor's death, their estate remains bound by the Guaranty for the franchisee's obligations existing at the time of death, and the obligations of any other guarantors remain in full effect. This ensures that Baymont Inn Suites has continuous recourse for the franchisee's obligations. The Guaranty can be executed in multiple counterparts, each considered an original, forming a single binding instrument. This allows for flexibility in obtaining signatures while maintaining the integrity of the agreement.