What exemptions does each Obligor waive under the Best Brains Promissory Note?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
Each person liable on this Note in any capacity, whether as maker, endorser, surety, guarantor or otherwise, and any holder (collectively hereafter "Obligor"), waives the benefit of the homestead exemption and of all other exemptions available to him and also waives presentment, demand, protest, notice of dishonor and all other notices of every kind and nature to which he would otherwise be entitled under the applicable law. Each Obligor agrees that Holder may take any one or more of the following actions, on one or more occasions, whether before or after the maturity of this Note, without any notice to such Obligor, without any further consent to such actions, and without releasing or discharging such Obligor from liability on the Note: (a) any extension or extensions of the time of payment of any principal, interest or other amount due and payable under this Note; (b) any renewal of this Note, in whole or in part; (c) any full or partial release or discharge from liability under this Note of any other Obligor; (d) any waiver of any default under this Note or other agreement between the Lender and any Obligor relating to the indebtedness evidenced by this Note; or (e) any agreement with the Maker changing the rate of interest or any other term or condition of this Note.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, any person liable on the promissory note, referred to as the "Obligor," waives certain legal protections. Specifically, the Obligor waives the benefit of the homestead exemption, which typically protects a person's primary residence from seizure by creditors. They also waive all other exemptions available to them under the law.
In addition to waiving these exemptions, the Obligor also waives presentment, demand, protest, notice of dishonor, and all other notices they would normally be entitled to under applicable law. This means that Best Brains, as the note holder, is not required to formally present the note for payment, demand payment, or provide notice if payment is not made.
Furthermore, the note holder can take several actions without notifying the Obligor or obtaining their consent, such as extending payment deadlines, renewing the note, releasing other Obligors from liability, waiving defaults, or changing the interest rate or other terms of the note. This clause provides significant flexibility to Best Brains in managing the promissory note and reduces the administrative burden of dealing with potential defaults or modifications. This is a significant consideration for a prospective franchisee, as it limits their rights and protections under the promissory note.