Is the liability of the Guarantors for a Chicken Guy franchise joint or several?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Each of the undersigned consents and agrees that: (i) his direct and immediate liability under this Guarantee shall be joint and several; (ii) he shall render any payment or performance required under the Agreement upon demand if Franchisee fails or refuses punctually to do so; (iii) such liability shall not be contingent or conditioned upon pursuit by Chicken Guy of any remedies against Franchisee or any other person; (iv) such liability shall not be diminished, relieved or otherwise affected by any amendment of the Agreement, any extension of time, credit or other indulgence which Chicken Guy may from time to time grant to Franchisee or to any other person including, without limitation, 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 the Agreement and for so long thereafter as there are monies or obligations owing from Franchisee to Chicken Guy or its affiliates under the Agreement; and (v) monies received from any source by Chicken Guy for application toward payment of the obligations under the Agreement and under this Guarantee may be applied in any manner or order deemed appropriate by Chicken Guy.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to the 2025 Chicken Guy Franchise Disclosure Document, the liability of the guarantors is joint and several. This means that each guarantor is individually liable for the full amount of the franchisee's obligations, as well as being jointly liable with the other guarantors. Chicken Guy can pursue any one or all of the guarantors for the full amount owed, regardless of the contributions or involvement of the other guarantors.
This arrangement benefits Chicken Guy by providing multiple avenues for recovering any losses or unpaid obligations. It also places a significant responsibility on each guarantor, as they are potentially liable for the entire debt, even if other guarantors are able to pay their share.
For a prospective Chicken Guy franchisee, this highlights the importance of carefully considering who will act as guarantors and ensuring that all parties understand the full extent of their potential liability. Franchisees should seek legal counsel to fully understand the implications of a joint and several guarantee before signing the franchise agreement.