Does the Carbones Pizzeria Guaranty extend to the Franchisor's successors and assigns?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
IN CONSIDERATION of the [INSERT ONE/DELETE REMAINING ONE] [grant by M & T Pizza Incorporated ("Franchisor") of a Carbone's Pizza franchise to the party named as Franchisee in the Franchise Agreement (the "Franchisee") to which this Guaranty is attached (the "Franchise Agreement")] OR [consent by M & T Pizza Incorporated ("Franchisor") to the assignment of the Franchise Agreement to which this Guaranty is attached (the "Franchise Agreement") to the assignee and party named as the Franchisee in the Franchise Agreement ("Franchisee")], and for other good and valuable consideration, receipt of which is hereby acknowledged, the undersigned hereby guarantee (jointly and severally with one another and all other guarantors of Franchisee, whether such guaranties are entered into prior to or after the date hereof) to Franchisor and to Franchisor's successors and assigns: (a) the payment of all costs and fees required to be paid to Franchisor or its affiliates by Franchisee, whether such costs and fees are provided for in the Franchise Agreement or under any other agreement between Franchisee and Franchisor or an affiliate of Franchisor, and (b) the performance by Franchisee of all its obligations under all such agreements and under all manuals and operating procedures of Franchisor's business system.
Source: Item 22 — CONTRACTS (FDD page 30)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, the Guaranty extends to the Franchisor's successors and assigns. This means that if M & T Pizza Incorporated, the franchisor, transfers ownership or rights to another entity, the guarantor's obligations under the Guaranty will continue to be in effect for the benefit of the new entity.
For a prospective Carbones Pizzeria franchisee, this implies that the obligation of a guarantor is not nullified if the Carbones Pizzeria franchise changes ownership. The guarantor remains responsible for the franchisee's financial and performance obligations, regardless of who owns the Carbones Pizzeria franchise. This provides added security to the franchisor (or its successors) that the franchisee's obligations will be met.
This clause is standard in franchising, as it protects the franchisor's interests in case of a sale, merger, or other transfer of the franchise system. It ensures continuity of the obligations guaranteed, regardless of changes in the franchisor's corporate structure.