Is the liability of the guarantor for a Casiola franchise contingent upon pursuing remedies against the franchisee?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
You agree that: (a) your direct and immediate liability under this guaranty shall be joint and several with Franchisee and all other signatories to this Agreement; (b) you will render any payment required under the Franchise Agreement and the Ancillary Agreements upon demand if Franchisee fails or refuses punctually to do so; (c) your liability shall not be contingent or conditioned upon pursuit by us of any remedies against Franchisee or any other person; and (d) liability shall not be diminished, relieved or otherwise affected by any extension of time, credit or other indulgence that we may grant to Franchisee or to any other person, including the acceptance of any partial payment or performance, or the compromise or release of any claims, none of which shall in any way modify or amend this guarantee, which shall be continuing and irrevocable during the term of each of the Franchise Agreement and the Ancillary Agreements and following the termination, expiration or Transfer of each of the Franchise Agreement and the Ancillary Agreements to the extent any financial obligations under any such Franchise Agreement and Ancillary Agreements survive such termination, expiration or Transfer. This guaranty will continue unchanged by the occurrence of any bankruptcy with respect to Franchisee or any assignee or successor of Franchisee or by any abandonment of one or more of the Franchise Agreement and/or and Ancillary Agreements by a trustee of Franchisee. Neither your obligation to make payment in accordance with the terms of this undertaking nor any remedy for enforcement shall be impaired, modified, changed, released or limited in any manner whatsoever by any impairment, modification, change, release or limitation of the liability of Franchisee or its estate in bankruptcy or of any remedy for enforcement, resulting from the operation of any present or future provision of the U.S. Bankruptcy Act or other statute, or from the decision of any court or agency.
Source: Item 23 — RECEIPTS (FDD pages 47–209)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, the guarantor's liability is not contingent upon Casiola first pursuing remedies against the franchisee. The guaranty agreement stipulates that the guarantor's liability is direct, immediate, joint, and several with the franchisee and all other signatories.
Specifically, the guarantor must make any payment required under the Franchise Agreement and Ancillary Agreements if the franchisee fails to do so. The guarantor's liability will not be diminished or affected by any extensions of time, credit, or other allowances granted to the franchisee, including acceptance of partial payments or compromise of claims.
Furthermore, the guaranty remains in effect during the term of the Franchise Agreement and Ancillary Agreements, even after termination, expiration, or transfer, to the extent that financial obligations survive. The guaranty is not affected by the franchisee's bankruptcy or abandonment of the Franchise Agreement. Casiola's ability to enforce payment from the guarantor is not limited by any changes to the franchisee's liability due to bankruptcy or other legal limitations.