What assets of Benihana and its subsidiaries secure the obligations under the Credit Agreement?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
This Guaranty is incorporated and made a part of a Franchise Agreement between FRANCHISEE and Benihana National Corp., a Delaware corporation, whose principal office address is 21500 Biscayne Boulevard, Suite 900, Aventura, Florida 33180 (hereinafter referred to as "FRANCHISOR") on the date specified above, and it will be attached to the Franchise Agreement.
-
- Acknowledgments. GUARANTOR acknowledges and agrees that FRANCHISOR has entered into the Franchise Agreement with FRANCHISEE solely on the condition that each owner of FRANCHISEE be personally obligated and jointly and severally liable with FRANCHISEE (and with each other owner of FRANCHISEE) for the performance of each and every obligation of FRANCHISEE (and its owners) under the Franchise Agreement, any amendments or modifications to the Franchise Agreement, any extensions or renewals of the Franchise Agreement, and under each and every agreement ancillary to the Franchise Agreement, including any lease, that has been or hereafter may be entered by FRANCHISEE with FRANCHISOR (all of the aforementioned agreements are collectively referred to as the "BENIHANA Agreements").
-
- GUARANTOR's Covenants, Representations and Guaranty. In consideration of and as an inducement to the execution of the Franchise Agreement by FRANCHISOR, Guarantor hereby personally, irrevocably and unconditionally:
- (a) represents and warrants to FRANCHISOR that the exhibits/attachments to the Franchise Agreement are accurate and complete;
- (b) agrees to guarantee the prompt payment and performance of all of FRANCHISEE's Obligations (as hereinafter defined) to FRANCHISOR and FRANCHISOR's successors and assigns; and
- (c) agrees to be personally bound by, and personally liable for the breach of each and every provision in the Franchise Agreement and each and every provision in any of the BENIHANA Agreements, as if GUARANTOR were the FRANCHISEE.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
Based on the 2024 Franchise Disclosure Document, the provided excerpts discuss the obligations of the franchisee and the role of a guarantor in ensuring these obligations are met, but they do not specify which assets of Benihana or its subsidiaries are used to secure obligations under any Credit Agreement. The documents focus on the franchisee's and guarantor's responsibilities, waivers, and liabilities related to the franchise agreement.
Specifically, the excerpts detail the guarantor's acknowledgment of their obligations, their agreement to guarantee the franchisee's payments and performance, and their consent to be bound by the franchise agreement as if they were the franchisee. The guarantor also waives certain rights and defenses, reinforcing their commitment to fulfilling the franchisee's obligations. The excerpts outline the conditions under which the guarantor's obligations become due and payable, including scenarios such as death, incapacity, insolvency, or bankruptcy.
To fully understand what assets of Benihana and its subsidiaries are used to secure the obligations under the Credit Agreement, a prospective franchisee should review the Credit Agreement within the FDD (if available) or directly ask the franchisor for specific details regarding the assets used as collateral. This information is crucial for assessing the financial stability and risk associated with the franchise.