Does the Guaranty and Assumption of Obligations for Browns Chicken extend beyond the term of the Franchise Agreement?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS GUARANTY AND ASSUMPTION OF OBLIGATIONS is given this day of , 20, by |
|---|
| of |
| 1. |
| In consideration of, and to induce BROWN'S CHICKEN, LLC (the "Company") to enter |
| into a franchise agreement dated, 20 (the "Franchise Agreement"), with |
| ("Franchisee"), each of the undersigned hereby |
| personally and unconditionally (a) guarantees to the Company, and its successors and assigns, |
| for the term of the Agreement and thereafter as provided in the Agreement, that the Franchisee |
| shall punctually pay and perform each and every undertaking, agreement and covenant set forth |
| in the Agreement; and (b) agrees to be personally bound by, and personally liable for the breach |
| of, each and every provision in the Agreement, both monetary obligations and obligations to take |
| or refrain from taking specific actions or to engage or refrain from engaging in specific activities, |
| including without limitation the provisions of Sections 15, 17, and 21 (all of which shall be |
| referred to as the "Obligations"). |
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, the Guaranty and Assumption of Obligations extends beyond the term of the Franchise Agreement. The guarantor personally and unconditionally guarantees to Browns Chicken that the franchisee will perform every agreement set forth in the Franchise Agreement for the term of the agreement and thereafter as provided in the agreement.
This means that individuals signing the Guaranty and Assumption of Obligations are liable for the franchisee's obligations not only during the term of the agreement but also for any continuing obligations outlined within the agreement that extend beyond the termination date. These obligations include both monetary obligations and obligations to take or refrain from taking specific actions.
For a prospective Browns Chicken franchisee, this implies a significant responsibility for those acting as guarantors. They must ensure the franchisee complies with all terms of the agreement, even after the franchise term ends, if the agreement specifies continuing obligations. This could include, but is not limited to, non-compete clauses or confidentiality agreements.
It is important for potential franchisees and their guarantors to carefully review the Franchise Agreement and understand all obligations that extend beyond the term of the agreement. Consulting with a legal professional is advisable to fully comprehend the scope and implications of the Guaranty and Assumption of Obligations.