During what period does the Guaranty and Assumption of Obligations under Sublease apply to Browns Chicken franchisees?
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 the 2025 Browns Chicken Franchise Disclosure Document, the Guaranty and Assumption of Obligations applies for the term of the Franchise Agreement and thereafter as provided in the agreement. This means that the guarantor is responsible for the franchisee's obligations not only during the active term of the franchise but also for any continuing obligations that extend beyond the termination date, as specified in the Franchise Agreement.
This obligation includes ensuring the franchisee punctually pays and performs every undertaking, agreement, and covenant outlined in the Franchise Agreement. The guarantor also agrees to be personally bound by and liable for any breaches of the agreement, including monetary obligations and requirements to take or refrain from specific actions, as detailed in Sections 15, 17, and 21 of the agreement.
For a prospective Browns Chicken franchisee, this implies that anyone signing a guaranty must understand they are taking on a significant, long-term financial and operational responsibility. They should carefully review the Franchise Agreement to fully understand the scope of these obligations, including any that might extend beyond the franchise term. It is also important to note that Browns Chicken may request a guaranty from the selling franchisee and its owners for the performance by the transferee of its obligations under the Franchise Agreement, for a duration not to exceed the remainder of the term of the transferor's Franchise Agreement, as determined by Browns Chicken.