Does the Beehive Homes Guarantor retain rights to reimbursement from the Franchisee?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
- Waivers of Certain Rights and Defenses. Each Guarantor waives: (a) any right or claim that Guarantor may have to require that an action be brought against Franchisee or any other person as a condition of Guarantor's liability under this Guaranty; (b) all rights to payments and claims for reimbursement or subrogation which any of the undersigned may have against Franchisee arising as a result of Guarantor's execution of and performance under this Guaranty; (c) any law or statute which requires that Franchisor make demand on, assert claims against or collect from Franchisee or any others, foreclose any security interest, sell collateral, exhaust any remedies or take any other action against Franchisee or any others before making any demand on, collecting from or taking any action against Guarantor under or with respect to this Guaranty; (d) any right or claim Guarantor may have that a release or discharge of Franchisee under the Franchise Agreement is a release or discharge of Guarantors under the Franchise Agreement or this Guaranty; and (e) any and all other notices and legal or equitable defenses to which Guarantor may be entitled.
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, the Guarantor waives rights to reimbursement from the Franchisee. Specifically, each Guarantor waives all rights to payments and claims for reimbursement or subrogation against the Franchisee that may arise from the Guarantor's execution of and performance under the Guaranty.
This waiver means that if a Guarantor makes payments or fulfills obligations on behalf of the Beehive Homes franchisee, the Guarantor cannot seek compensation or reimbursement from the franchisee for those payments or obligations. This is a significant point for anyone considering acting as a guarantor, as they are giving up their right to be repaid by the franchisee.
This clause protects Beehive Homes by ensuring that the Guarantor remains fully liable without the possibility of recourse against the franchisee, which could complicate or undermine the enforcement of the guaranty. Prospective franchisees should carefully consider the implications of this waiver and the financial risks involved before asking someone to act as a guarantor for their franchise agreement.