For Cicis, what is the effect of accepting partial payment from the Developer on the Guaranty?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
Each Guarantor consents and agrees that: (1) Guarantor's direct and immediate liability under this Guaranty will be joint and several, both with Developer and among other guarantors; (2) Guarantor will render any payment or performance required under the Agreement upon demand if Developer fails or refuses punctually to do so; (3) this liability will not be contingent or conditioned upon our pursuit of any remedies against Developer or any other person; (4) this liability will not be diminished, relieved, or otherwise affected by any extension of time, credit, or other indulgence which we may from time to time grant to Developer 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 will in any way modify or amend this Guaranty, which will be continuing and irrevocable during the term of the Agreement; and (5) at our request, each Guarantor shall present updated financial information to us as reasonably necessary to demonstrate such Guarantor's ability to satisfy the financial obligations of Developer under the Agreement.
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the acceptance of partial payment from the Developer does not diminish, relieve, or otherwise affect the Guaranty. The Guaranty remains continuing and irrevocable during the term of the Area Development Agreement.
Specifically, the Guarantor's liability will not be affected by the acceptance of any partial payment or performance. This means that even if Cicis accepts a portion of what is owed by the Developer, the Guarantor is still responsible for the full amount guaranteed under the Area Development Agreement. The Guaranty is not modified or amended by such actions and remains in full effect.
This provision protects Cicis by ensuring that the Guarantor remains fully liable for the Developer's obligations, regardless of any partial payments or concessions Cicis might make to the Developer. For a prospective franchisee acting as a Guarantor, this means understanding that their financial responsibility is comprehensive and not reduced by the Developer's partial payments or any other indulgences granted to the Developer. The Guarantor should be prepared to cover the full obligations of the Developer under the Area Development Agreement if the Developer fails to do so.