What does 'Guaranteed Obligations' mean in the context of the Caption By Hyatt Guaranty?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, as a condition to entering into the Franchise Agreement, Hyatt has required that Guarantor guarantee the payment and performance of the Guaranteed Obligations (as defined herein), subject to the terms of this Guaranty.
NOW, THEREFORE, as a material inducement to Hyatt entering into the Franchise Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor hereby does irrevocably and unconditionally warrant and represent unto and covenant as follows:
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- Guaranty. Guarantor hereby irrevocably and unconditionally personally guarantees to Hyatt and its successors and assigns Franchisee's punctual payment and performance of, and agrees to be personally bound by and personally liable for the breach of, each and every Guaranteed Obligation. Guarantor hereby irrevocably and unconditionally covenants and agrees that it is liable for the Guaranteed Obligations as a primary obligor.
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- Guaranteed Obligations. As used herein, the term "Guaranteed Obligations" means (i) Franchisee's payment in full of all of Franchisee's monetary obligations including but
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Caption By Hyatt's 2025 Franchise Disclosure Document, the 'Guaranteed Obligations' refer to the financial responsibilities of the franchisee that are guaranteed by a third party, known as the Guarantor. The Guarantor ensures Caption By Hyatt that the franchisee will fulfill its monetary obligations under the Franchise Agreement. This guarantee is a prerequisite for Hyatt entering into the Franchise Agreement with the franchisee.
The Guarantor is liable for any breaches of these guaranteed obligations, acting as a primary obligor. This means that Caption By Hyatt can seek fulfillment of these obligations directly from the Guarantor without first pursuing the franchisee. The Guarantor's obligations are comprehensive, covering the franchisee's monetary commitments.
The Guarantor also consents to various conditions, including that their obligations apply in an individual capacity and are joint and several with the franchisee and other guarantors. The Guarantor is responsible for making payments if the franchisee fails to do so and this liability is not contingent upon Caption By Hyatt pursuing remedies against the franchisee first. The Guaranty remains in effect even with extensions or modifications to the Franchise Agreement, or transfers of interest in the agreement or franchisee, and the Guarantor waives notice of such changes.