Can a guarantor of the Engel & Volkers Franchise Agreement be substituted without affecting the obligations of the undersigned?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
The undersigned hereby agree, furthermore, that without the consent of or notice to any of the undersigned and without affecting any of the obligations of the undersigned hereunder: (a) any term, covenant or condition of the Franchise Agreement may be amended, compromised, released or otherwise altered by Franchisor and Franchisee, and the undersigned do guarantee and promise to perform all the obligations of Franchisee under the Franchise Agreement as so amended, compromised, released or altered; (b) any guarantor of or party to the Franchise Agreement may be released, substituted or added; (c) any right or remedy under the Franchise Agreement, this Guarantee or any other instrument or agreement between Franchisor and Franchisee may be exercised, not exercised, impaired, modified, limited, destroyed or suspended; and, (d) Franchisor or any other person may deal in any manner with Franchisee, any of the undersigned, any party to the Franchise Agreement or any other person.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the obligations of a guarantor remain even if another guarantor is substituted or added to the Franchise Agreement. Specifically, the guarantor's obligations are not affected even without their consent or notification. This means that the original guarantor remains fully responsible for the franchisee's obligations, regardless of any changes to the guarantor pool.
This provision protects Engel & Volkers by ensuring that the financial backing for the franchise remains secure, even if the specific individuals or entities providing the guarantee change. It also allows Engel & Volkers to make changes to the agreement or release other guarantors without needing to seek consent from every guarantor, streamlining administrative processes.
For a prospective Engel & Volkers franchisee, this clause highlights the importance of fully understanding the guarantee obligations before signing. If you are considering acting as a guarantor, be aware that your obligations will continue even if other guarantors are added or replaced. It is advisable to seek legal counsel to fully understand the implications of this clause before committing to the guarantee.