Can the Cicis Guaranty be modified or amended by accepting partial payment from the Franchisee?
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.
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 the guarantor is not affected by the acceptance of partial payments from the franchisee. The guarantor's liability remains unchanged even if Cicis grants extensions of time, credit, or other indulgences to the franchisee. This means that the guarantor's obligation to ensure the franchisee fulfills their obligations under the Franchise Agreement remains in full effect, regardless of any partial payments or compromises Cicis might accept.
This provision protects Cicis by ensuring that the Guaranty remains in force throughout the term of the Franchise Agreement, regardless of any modifications or indulgences granted to the franchisee. The Guaranty is designed to be continuing and irrevocable, providing Cicis with a consistent and reliable form of security. The guarantor remains liable for the franchisee's full performance, even if Cicis accepts less than the full amount due at any given time.
For a prospective Cicis franchisee, this means that anyone acting as a guarantor (often a principal of the franchisee entity) should understand that their obligations are not diminished by partial payments or other concessions Cicis might make to the franchisee. The guarantor should be prepared to fulfill the franchisee's obligations in full if the franchisee fails to do so, as the Guaranty remains in effect regardless of these circumstances. This clause is typical in franchise agreements, as franchisors seek to secure their financial interests and ensure consistent performance from franchisees.