For a Bor Restoration franchise, what is the 'Effective Date' of the Guaranty of Franchisee's Obligations?
Bor_Restoration Franchise · 2024 FDDAnswer from 2024 FDD Document
| This Guaranty of Franchisee's Obligations (Guaranty) is entered into as of the date that it is signed by all Parties (Effective Date) of this Guaranty, between BOR Franchising, LLC (Franchisor), (Franchisee) and , and (jointly and severally known as "Guarantor(s)"). Franchisor, Franchisee, and Guarantors may be referred to as a "Party" or as the "Parties." Any capitalized term not defined here will have the meaning given to it in the Franchise Agreement. |
|---|
| RECITALS |
| Franchisee signed a franchise agreement with Franchisor on the day of, 20 |
| (Franchise Agreement). |
| As an inducement to the Franchisor for granting the |
| franchise rights, the |
| Guarantor(s) agreed to fully guaranty the payment and performance of Franchisee under the Franchise |
| Agreement; |
| NOW, THEREFORE, for and in consideration of the mutual covenants found herein and for other |
| good and valuable consideration, which consideration is deemed to be adequate by all Parties, each of the |
| undersigned personally and unconditionally agrees |
| to the following: |
| COVENANTS |
| 1. |
| Guarantor(s) guarantee to Franchisor and its successors and assigns, for the Term of the |
| Franchise Agreement, that Franchisee will |
| timely pay any amount required by the Franchise Agreement |
| and will perform every undertaking, agreement, and covenant under the Franchise Agreement and any |
| addenda or Exhibits attached to it |
| as each may be amended or renewed. |
| 2. |
| Guarantor(s) also agrees to be personally bound by every term of the Franchise |
| Agreement, as amended or renewed, |
| and agrees to be personally liable for the breach of and cure of every |
| breach of any term, covenant, or condition of the Franchise Agreement. |
| Guarantor(s) agree that this |
| Guaranty is one of payment and performance and not one of just collection. |
| 3. |
| By signing this Guaranty, each Guarantor further agrees that each shall also be subject to |
| all restrictive covenants in the Franchise Agreement, including |
| all covenants of Articles |
| 6, 14, 15, |
| and 16. |
| 4. |
| As part of the inducement given to Franchisor by Guarantor(s), |
| the Guarantor(s) further |
| agree to waive the following, |
| a. |
| acceptance or notice of acceptance; |
| b. |
| notice of demand for payment of any indebtedness or notice of any |
| nonperformance of any obligations; |
| c. |
| protest and notice of default concerning |
| the indebtedness or nonperformance of |
| any obligations guaranteed; |
| d. |
| any right Guarantor may have to require that any action be first brought against |
| Franchisee or any other Person |
| as a condition of liability; and |
| © 2024 All rights reserved BOR Franchising, LLC Gen 3-30-24 |
| 92 |
| Initials |
| Initials |
Source: Item 23 — Receipts (FDD pages 40–202)
What This Means (2024 FDD)
According to Bor Restoration's 2024 Franchise Disclosure Document, the Effective Date of the Guaranty of Franchisee's Obligations is the date that all parties sign the Guaranty. This means the guaranty becomes legally binding on the date when both BOR Franchising, LLC (the Franchisor), the Franchisee, and the Guarantor(s) have signed the document.
In practical terms, this date is crucial because it marks the point from which the Guarantor(s) become responsible for the Franchisee's obligations under the Franchise Agreement. The Guarantor(s) agree to fully guarantee the payment and performance of the Franchisee, ensuring that all financial and operational commitments are met.
This arrangement provides Bor Restoration with an added layer of security, knowing that there is a party (the Guarantor) personally liable for the Franchisee's adherence to the Franchise Agreement. The Guarantor(s) also waive certain rights, such as requiring the Franchisor to first pursue action against the Franchisee before seeking recourse from the Guarantor(s).