Who are the 'Guarantors' in the context of a City Wide franchise agreement?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
| THIS SPOUSAL GUARANTY AND ASSUMPTION OF OBLIGATIONS ("Guaranty"), |
|---|
| made and entered into on, by, |
| ("Spousal Guarantor"), in favor of |
| CITY WIDE FRANCHISE COMPANY, INC., a Kansas corporation |
| ("CITY WIDE"). |
| WHEREAS, Spousal Guarantor is either married to or otherwise legally recognized as the spouse |
| or domestic partner of |
| an owner of |
| ("Franchisee"), a |
| [corporation/partnership/limited liability company], which has entered into that certain |
| Franchise Agreement with CITY WIDE, dated as of even date herewith ("Franchise Agreement"); and |
| WHEREAS, Spousal |
| Guarantor desires to personally and unconditionally guarantee the |
| obligations of Franchisee under the Franchise Agreement, subject to the limitations set forth in this |
| Guaranty |
| guarantee. |
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to the 2025 City Wide Franchise Disclosure Document, a 'Guarantor' may refer to a 'Spousal Guarantor.' The Spousal Guarantor is either married to, or legally recognized as the spouse or domestic partner of, an owner of the franchise. The Spousal Guarantor provides a personal and unconditional guarantee of the franchisee's obligations under the Franchise Agreement. This guarantee is subject to specific limitations outlined in the Spousal Guaranty and Assumption of Obligations agreement.
The Spousal Guarantor agrees to guarantee the punctual payment of all obligations of the franchisee, including fees, expenses, and interest, as outlined in the Franchise Agreement. This obligation extends to covering any expenses, including attorney fees, that City Wide incurs while enforcing its rights under the Guaranty. The liability of the Spousal Guarantor is absolute and unconditional, regardless of the validity or enforceability of the Franchise Agreement or any changes to payment terms.
The Spousal Guarantor also waives certain rights, including any rights of subrogation that could interfere with City Wide's claims or demands under the Franchise Agreement. This waiver includes the right to seek contribution or indemnification from the franchisee or any other guarantor. The Guaranty remains in effect until all obligations are fully paid and is binding upon the Spousal Guarantor and City Wide, including their successors and assigns. City Wide can transfer the Franchise Agreement to another entity, which will then have all the rights granted to City Wide under the Guaranty.