Under what conditions does the Guarantee terminate concerning the Brueggers Bagels Franchise Agreement?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
This Guarantee shall terminate upon the termination or expiration of all obligations of Franchisee under the Agreement and/or any other agreements between Franchisee and Franchisor, except that all obligations and liabilities of the undersigned which arose from events which occurred on or before the effective date of such termination shall remain in full force and effect until satisfied or discharged by the undersigned, and all covenants which by their terms continue in force after the expiration or termination of the Agreement shall remain in force according to their terms. Upon the death of an individual guarantor, the estate of such guarantor shall be bound by this Guarantee, but only for defaults and obligations under this Agreement existing at the time of death; and the obligations of the other guarantors will continue in full force and effect.
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels's 2025 Franchise Disclosure Document, the Guarantee associated with the Franchise Agreement terminates when all of the franchisee's obligations under the Agreement and any other agreements between the franchisee and Brueggers Bagels are terminated or have expired. However, any obligations or liabilities of the guarantor that arose before the termination date remain in effect until they are satisfied or discharged. Additionally, any covenants that are designed to continue after the expiration or termination of the Agreement will remain in force according to their specific terms.
In the event of the death of an individual guarantor, their estate will be responsible for defaults and obligations existing at the time of death. The obligations of any other guarantors will remain fully in effect. This means that even after the Franchise Agreement ends, the guarantor may still be responsible for certain financial or legal obligations that arose during the term of the agreement.
This clause protects Brueggers Bagels by ensuring that obligations are met even after the franchise agreement ends, and it clarifies the responsibilities of guarantors and their estates. Prospective franchisees should carefully review these terms with their legal counsel to fully understand the extent and duration of their guarantee obligations.