Are the Guarantor's obligations under the Beehive Homes Guaranty joint and several?
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 the 2025 Beehive Homes Franchise Disclosure Document, the obligations of each guarantor are joint and several. This means that each guarantor is individually and collectively responsible for the full amount of the franchisee's obligations to Beehive Homes. Beehive Homes can pursue any one guarantor for the entire debt, regardless of the contributions or responsibilities of other guarantors.
For a prospective Beehive Homes franchisee, this has significant implications. If multiple individuals act as guarantors (e.g., business partners, family members), each guarantor puts their personal assets at risk for the entire franchise debt. If the franchisee defaults, Beehive Homes can target the guarantor with the most accessible assets, even if that guarantor's stake in the franchise is smaller than others.
This arrangement protects Beehive Homes by ensuring they have multiple avenues to recover any losses. However, it creates a substantial risk for each guarantor, who could be held liable for the entire debt even if other guarantors are able to contribute. Prospective franchisees should carefully consider the financial capacity and risk tolerance of each guarantor before entering into such an agreement. It is advisable for all guarantors to seek independent legal and financial advice to fully understand the extent of their obligations and potential liabilities under the Beehive Homes guaranty.