Who benefits from and is bound by the Casa De Corazon Security Agreement?
Casa_De_Corazon Franchise · 2025 FDDAnswer from 2025 FDD Document
r as of the date indicated The Initial Franchise Fee is: $ above. If corporation, limited liability company, or partnership: CASA FRANCHISING, LLC [INSERT FRANCHISEE NAME] If individual:
GUARANTY
IN CONSIDERATION of the [INSERT ONE/DELETE REMAINING ONE] [grant by Casa Franchising, LLC ("Franchisor") of a Casa de Corazon 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 Casa Franchising, LLC ("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 to Franchisor and to Franchisor's successors and assigns: (a) the payment of all amounts to be paid to Franchisor or its affiliates by the Franchisee, whether such amounts 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 51)
What This Means (2025 FDD)
According to the 2025 Casa De Corazon Franchise Disclosure Document, the Guaranty agreement ensures that Casa De Corazon (the Franchisor) and its successors and assigns are guaranteed payment of all amounts owed by the Franchisee. It also guarantees the Franchisee's performance of all obligations under the Franchise Agreement and any other agreements with Casa De Corazon or its affiliates, including adherence to the franchisor's manuals and operating procedures.
The Guarantor, by signing the Personal Guaranty, agrees to be individually bound by all the obligations and commitments of the Franchisee as if they were individually named as the Franchisee in the Franchise Agreement. This means the Guarantor is equally responsible for upholding the terms of the agreement.
In essence, the Personal Guaranty provides Casa De Corazon with an additional layer of security, ensuring that there is a party (the Guarantor) who is personally liable for the financial and operational obligations of the Franchisee. This is a common practice in franchising, especially when the Franchisee is a corporate entity, to ensure that individuals with a vested interest in the franchise's success are personally committed to its performance.