What specific notices related to the Bft Multi-Unit Agreement is the Guarantor waiving?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon demand by Franchisor, Guarantor will immediately make each payment required of Developer under the Multi-Unit Agreement. Guarantor hereby waives any right to require Franchisor to: (a) proceed against Developer for any payment required under the Multi-Unit Agreement; (b) proceed against or exhaust any security from Developer; or (c) pursue or exhaust any remedy, including any legal or equitable relief, against Developer. Without affecting the obligations of Guarantor under this Guarantee, Indemnification and Acknowledgment (the "Guarantee"), Franchisor may, without notice to Guarantor, extend, modify, or release any indebtedness or obligation of Developer, or settle, adjust or compromise any claims against Developer.
Guarantor waives notice of amendment of the Multi-Unit Agreement and notice of demand for payment by Developer and agrees to be bound by any and all such amendments and changes to the Multi-Unit Agreement.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the guarantor, upon demand by the franchisor, is obligated to immediately make each payment required of the developer under the Multi-Unit Agreement. As part of this agreement, the guarantor waives certain rights that would otherwise protect them. Specifically, the guarantor waives any right to require Bft to first proceed against the developer for any payment required under the Multi-Unit Agreement, or to proceed against or exhaust any security from the developer, or to pursue or exhaust any remedy, including any legal or equitable relief, against the developer before seeking payment from the guarantor.
Additionally, the guarantor waives notice of any amendments to the Multi-Unit Agreement and notice of demand for payment by the developer. This means that Bft can modify the Multi-Unit Agreement without informing the guarantor, and the guarantor will still be bound by those changes. The guarantor also forgoes the right to be notified if Bft demands payment from the developer.
This waiver has significant implications for a prospective Bft franchisee acting as a guarantor. By waiving these rights, the guarantor takes on a substantial risk, as they can be held liable for the developer's obligations without prior notice or recourse against the developer. It is crucial for potential guarantors to fully understand the terms of the Multi-Unit Agreement and the implications of this waiver before signing the guarantee.