Does assignment by Beehive Homes affect the Guarantor's liability?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS GUARANTY AND ASSUMPTION OF OBLIGATIONS UNDER FRANCHISE | ||
|---|---|---|
| AGREEMENT (the "Guaranty") is given this day of, 2025, by the undersigned: | ||
| 1. | In consideration of, and as an inducement to, the execution of the franchise agreement | |
| dated, 2025 (referred to in this Guaranty, together with all applicable | ||
| amendments, renewals, addenda, supplemental agreements and assignments, as the "Franchise | ||
| Agreement") by and among BEE HIVE HOMES, INC. (the "Franchisor") and the parties | ||
| identified therein as the Franchisee (the "Franchisee"), and for other good and valuable | ||
| consideration, each of the undersigned, jointly and severally, for themselves, their heirs, legal | ||
| representatives, successors and assigns (hereinafter referred to individually | and collectively as | |
| "Guarantor" whether one or more) personally, unconditionally | and irrevocably guarantees to | |
| Franchisor, and its successors and assigns, (a) the full and prompt payment of all sums owed by | ||
| Franchisee to Franchisor and its Affiliates under the Franchise Agreement and otherwise relating | ||
| to the Home, including, but not limited to, all fees and charges, interest, default interest, all other | ||
| costs and fees and attorneys' fees incurred in connection with enforcement of the Franchise | ||
| Agreement; and (b) the performance of all other obligations of Franchisee arising under the | ||
| Franchise Agreement (collectively, the "Obligations"). This Guaranty | is primary to Guarantor | |
| and Guarantor will immediately, upon request of Franchisor, make payment in full of all amounts | ||
| due and owing to Franchisor and its Affiliates under the Franchise Agreement, and perform each | ||
| and every Obligation to Franchisor and its Affiliates under the Franchise Agreement. | ||
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, the "Guaranty and Assumption of Obligations Under Franchise Agreement" outlines the guarantor's responsibilities. As stated in the agreement, the guarantor provides a personal, unconditional, and irrevocable guarantee to Beehive Homes, including its successors and assigns. This guarantee covers the full and prompt payment of all sums owed by the franchisee to Beehive Homes and its affiliates under the Franchise Agreement. It also includes the performance of all other obligations of the franchisee arising under the Franchise Agreement.
The guarantor's obligation is primary, meaning that upon Beehive Homes' request, the guarantor must immediately pay all amounts due and owing and fulfill every obligation under the Franchise Agreement. This indicates that the guarantor's liability remains in effect even if the franchise agreement is assigned to a new franchisee. The guarantor is bound to the terms of the franchise agreement regardless of any assignment.
This clause protects Beehive Homes by ensuring that there is always a party responsible for the financial and operational obligations of the franchise. For a prospective franchisee, this means that if they require a guarantor to secure the franchise agreement, that guarantor remains liable even if the franchisee later sells or transfers the franchise. The guarantor should be fully aware of the obligations they are undertaking, as their liability continues even after the initial franchisee is no longer involved.