Does the Guaranty of Performance for a Coffee News franchise cover the Promissory Note?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
OF PERFORMANCE**
(To Be Executed by Principal Stockholder(s) If Franchisee/Debtor is a Corporation, professional corporation, partnership, limited liability partnership, limited liability company)
FOR VALUE RECEIVED, and in consideration for, and as in inducement to Coffee News USA, Inc. as the Holder to make the foregoing Schedule B / C to Coffee News Franchise [name of the Franchisee/Debtor], as the Debtor Agreement with (the "Schedule B"), the undersigned, who each own 5% or more of the Debtor, unconditionally guarantee the full performance of all the covenants, conditions and agreements therein provided to be performed and observed by the Debtor and the Debtor's successors and assigns pursuant to the Schedule B / C and the Promissory Note contained therein, and expressly agrees that the validity of this Guaranty of Performance and the obligations of the guarantor(s) hereunder shall not be terminated, affected or impaired by reason of the granting by Holder of any indulgences to Debtor or by reason of the assertion by Holder against Debtor of any of the rights or remedies reserved to Holder pursuant to the provisions of the Schedule B / C or by the relief of Debtor from any of Debtor's obligations under said Schedule B / C by operation of law or otherwise (including without implied limitation, the rejection or assignment of the Schedule B / C and/or the Promissory Note) in connection with proceedings under bankruptcy laws now or hereafter enacted), irrespective of Holder's consent or other action or inaction with respect to such relief, the undersigned hereby waiving notice, protest, demand of the acceptance of this Guaranty all suretyship defenses and all defenses in the nature thereof.
The undersigned further covenants and agrees that this Guaranty shall continue in full force and effect as to any modification or extension of the Schedule B / C, whether or not the undersigned shall have received any notice of or consented to such modification or extension.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, the Guaranty of Performance does cover the Promissory Note. Specifically, if the franchisee/debtor is a corporation, professional corporation, partnership, limited liability partnership, or limited liability company, the principal stockholders who own 5% or more of the debtor must execute the Guaranty of Performance.
This guaranty ensures the full performance of all covenants, conditions, and agreements outlined in Schedule B or C and the Promissory Note. The guarantor(s) unconditionally guarantee the debtor's obligations under the Schedule B/C and the Promissory Note. This means that the guarantor is responsible for the debt and obligations of the franchisee.
The Guaranty of Performance remains valid regardless of any indulgences granted to the debtor by the holder (Coffee News USA, Inc.), any assertion of rights or remedies against the debtor, or any relief of the debtor's obligations, even in cases of bankruptcy. The guarantor(s) waive any notice, protest, demand, acceptance of the Guaranty, suretyship defenses, and similar defenses. The franchisee acknowledges receipt of the Schedule B, the Promissory Note, and the Guaranty of Performance, indicating they have read and understood these documents and had the opportunity to seek legal consultation.