What is included in the 'Obligations' that the Guarantor guarantees for Crave?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
gal or equitable discharge of a surety or guarantor, and Guarantor waives the benefit of all principles or provisions of Law, statutory or otherwise, which are or might be in conflict with the terms of this Guaranty, and agrees that the obligations of Guarantor shall not be affected by any circumstances, whether or not referred to in this Guaranty which might otherwise constitute a legal or equitable discharge of a surety or a guarantor. Specifically, Guarantor waives the benefits of any right of discharge and any
other rights of sureties and guarantors under applicable law. Without limiting the generality of the foregoing, Guarantor agrees that Sublessor may, in its sole and absolute discretion, without notice to or consent by Guarantor, and without in any way releasing or impairing any liability or obligation of Guarantor hereunder, (i) waive compliance by Sublessee with any of its Obligations or covenants under the Lease or waive any default thereunder, or grant any other indulgence with respect to the Lease, (ii) modify, amend or change any provision of the Sublease, (iii) grant extensions or renewals of the Sublease or the Obligations, or effect any release, compromise or settlement in connection therewith, including any release of the liability of Sublessee or any guarantor or other person liable on the Obligations or any part thereof, (iv) transfer its interest in the premises covered by the Sublessor its rights under this Guaranty, (v) consent to the assignment by Sublessee of its rights under the Lease, and (vi) deal in all respects with Sublessee and the Obligations as if this Guaranty were not in effect. Guarantor further waives (i) notices of acceptance of this Guaranty, (ii) notices to Guarantor of any kind in any circumstances whatsoever, including without limitation, notice of dishonor and notice of any default by Sublessor under the Sublease and all waivers or indulgences granted by Sublessor to Sublessee under the Sublease, and (iii) diligence, presentment and suit on the part of Sublessor in the enforcement of any of the Obligations.
Notwithstanding anything contained herein to the contrary, this Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time, payment, or any part thereof, of any or all of the Obligation is rescinded or must otherwise be restored or returned by Landlord upon the insolvency, bankruptcy or reorganization of Sublessee, any other guarantor of the Sublease or otherwise, all as though such payment had not been made. Notwithstanding any modification, discharge or extension of the Obligation or any amendment, modification, stay or cure of Sublessor's rights which may occur in any bankruptcy or reorganization case or proceeding concerning Sublessor, whether permanent or temporary, and whether assented to by Sublessor, Guarantor hereby agrees that Guarantor shall be obligated to pay or perform the Obligation and the terms of this Guaranty in effect on the date hereof.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the Guarantor's obligations are extensive and designed to ensure the sublessee (franchisee) fulfills all duties under the lease agreement. The guarantor essentially steps in to ensure that all financial and operational responsibilities of the franchisee are met. This includes, but isn't limited to, the payment of rent, adherence to operational standards, and compliance with all terms and covenants outlined in the lease.
The guarantor's responsibilities are not diminished even if Crave, acting as the sublessor, makes concessions to the franchisee. Crave can waive compliance, modify the sublease, grant extensions, or even release the franchisee from liability without affecting the guarantor's obligations. The guarantor also waives rights to notices of acceptance, default, or dishonor, and agrees that Crave doesn't need to pursue the franchisee or any security before seeking recourse from the guarantor.
This arrangement protects Crave by providing an additional layer of security. Even if the franchisee faces financial difficulties or fails to meet their obligations, Crave can turn to the guarantor for fulfillment. However, this places a significant burden on the guarantor, who must be prepared to cover all potential liabilities of the franchisee. Prospective guarantors should carefully consider the financial risks and legal implications before agreeing to guarantee a Crave franchise.
The guarantor's obligations are irrevocable and unconditional, meaning they stand regardless of the validity or enforceability of the lease or any related security. The guarantor also waives any legal rights that could conflict with the terms of the guaranty, ensuring that their obligations remain intact under various circumstances. This comprehensive and unwavering commitment underscores the importance of fully understanding the risks and responsibilities associated with acting as a guarantor for a Crave franchise.