Is the Cicis Guaranty continuing and irrevocable during the term of the Agreement?
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 Franchisee and among other guarantors; (2) Guarantor will render any payment or performance required under the Agreement upon demand if Franchisee fails or refuses punctually to do so; (3) this liability will not be contingent or conditioned upon our pursuit of any remedies against Franchisee 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 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 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 Franchisee under the Agreement.
Each Guarantor waives: (i) all rights to payments and claims for reimbursement or subrogation which any Guarantor may have against Franchisee arising as a result of the Guarantor's execution of and performance under this Guaranty; and (ii) acceptance and notice of acceptance by us of Guarantor's undertakings under this Guaranty, notice of demand for payment of any indebtedness or non-performance of any obligations hereby guaranteed, protest and notice of default to any party with respect to the indebtedness or nonperformance of any obligations hereby guaranteed, and any other notices to which he or she may be entitled.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the Guaranty provided by each guarantor is continuing and irrevocable during the term of the Franchise Agreement. This means that the guarantor's obligation to ensure the franchisee fulfills their responsibilities under the agreement remains in effect throughout the entire duration of the agreement.
Specifically, each guarantor agrees that their liability is joint and several with the franchisee and among other guarantors. This means Cicis can pursue any guarantor for the full amount owed if the franchisee fails to meet their obligations. The guarantor's liability is not contingent on Cicis first pursuing remedies against the franchisee or any other person. Furthermore, any extensions of time or credit granted to the franchisee do not diminish or affect the guarantor's obligations.
The guarantor also waives certain rights, including rights to payments and claims for reimbursement or subrogation against the franchisee. They also waive the right to receive notices related to acceptance of the guaranty, demands for payment, or default. Cicis may request updated financial information from each guarantor to demonstrate their ability to meet the franchisee's financial obligations.
This arrangement provides Cicis with a strong assurance that the financial and contractual obligations of the franchisee will be met, as the guarantor's commitment is both ongoing and cannot be revoked during the term of the agreement. For a prospective franchisee, this highlights the importance of carefully selecting a guarantor who is financially stable and fully understands the extent of their obligations under the Guaranty.