Besides the obligations in Section 12, what other section of the Carls franchise agreement are the guarantors personally bound by?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
- **2.
Guarantee and Assumption of Developer's Obligations.** Guarantors hereby: (A) guarantee to CJR and its successors and assigns, for the term of the Agreement and thereafter as provided in the Agreement or at law or in equity, that Developer and any assignee of Developer's interest under the Agreement shall (1) punctually pay and perform each and every undertaking, agreement and covenant set forth in the Agreement and (2) punctually pay all other monies owed to CJR and/or its affiliates; (B) agree to be personally bound by each and every provision in the Agreement, including, without limitation, the provisions of Sections 12 and 16; and (C) agree to be personally liable for the breach of each and every provision in the Agreement.
Source: Item 23 — RECEIPTS (FDD pages 80–480)
What This Means (2024 FDD)
According to the 2024 Carls FDD, guarantors are personally bound by obligations outlined in Section 12 of the franchise agreement. In addition to Section 12, guarantors also agree to be personally bound by each and every provision in the agreement, including the provisions of Section 16.
This means that the guarantors' responsibilities extend beyond just the restrictions detailed in Section 12, encompassing all aspects of the franchise agreement. This broadens the scope of their liability and commitment to Carls.
For a prospective Carls franchisee, this highlights the importance of carefully reviewing the entire franchise agreement, as the guarantor's personal liability is not limited to specific sections but applies to the agreement as a whole. It is advisable to seek legal counsel to fully understand the implications of providing a guarantee for the franchise agreement.