What obligations of the Franchisee does the Guarantor guarantee to Carl's Jr.?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
- **2.
Guarantee and Assumption of Franchisee'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 Franchisee and any assignee of Franchisee'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 20 and 25; and (C) agree to be personally liable for the breach of each and every provision in the Agreement.
- **1.
Guarantee To Be Bound By Certain Obligations.** Guarantors hereby personally and unconditionally 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 each will be personally bound by the restrictions contained in Section 20 of the Agreement.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Carl's Jr. Franchise Disclosure Document, the Guarantor assumes significant responsibility for the franchisee's obligations. Specifically, the Guarantors guarantee that the Franchisee will punctually pay and perform every undertaking, agreement, and covenant outlined in the Franchise Agreement. This includes ensuring all monies owed to Carl's Jr. and its affiliates are paid on time.
Furthermore, the Guarantors agree to be personally bound by every provision in the agreement, including sections 20 and 25, and accept personal liability for any breaches of these provisions. This means that if the franchisee fails to meet their obligations, Carl's Jr. can seek recourse directly from the Guarantors.
The Guarantors also agree to be bound by restrictions contained in Section 20 of the Agreement. This guarantee extends for the entire term of the agreement and beyond, as specified in the agreement or by law. This ensures Carl's Jr. has a safety net in case the franchisee defaults on their commitments, providing added security for the franchisor.