What must the guarantor do upon demand by Face Foundrie Franchising L.L.C.?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon demand by Franchisor, the undersigned hereby agrees to immediately make each payment required of Area Developer under the Agreement and waive any right to require Franchisor to: (a) proceed against Area Developer for any payment required under the Agreement; (b) proceed against or exhaust any security from Area Developer; (c) pursue or exhaust any remedy, including any legal or equitable relief, against Area Developer; or (d) give notice of demand for payment by Area Developer. Without affecting the obligations of the undersigned under this Guaranty, Franchisor may, without notice to the undersigned, extend, modify, or release any indebtedness or obligation of Area Developer, or settle, adjust, or compromise any claims against Area Developer, and the undersigned hereby waives notice of same and agrees to remain and be bound by any and all such amendments and changes to the Agreement.
The undersigned hereby agrees to defend, indemnify and hold Franchisor harmless against any and all losses, damages, liabilities, costs, and expenses (including, but not limited to, reasonable attorney's fees, reasonable costs of financial and other investigation, court costs, and fees and expenses) resulting from, consisting of, or arising out of or in connection with any failure by Area Developer to perform any obligation of Area Developer under the Agreement, any amendment thereto, or any other agreement executed by Area Developer referred to therein.
The undersigned hereby acknowledges and expressly agrees to be personally bound by all of the covenants contained in the Agreement, including, without limitation, those covenants contained in Sections 7 and 8. Signature by the undersigned on this Guaranty constitutes the undersigned's signature on the Agreement related to all covenants. The undersigned asserts that he or she has read such covenants, been advised by counsel regarding their effect, and hereby affirmatively agree to them in order to secure the rights granted to Area Developer by Franchisor under the Agreement. The undersigned further acknowledges and agrees that this Guaranty does not grant the undersigned any right to use the "Face Foundrié" marks or system licensed to Area Developer under the Agreement.
Source: Item 23 — RECEIPTS (FDD pages 74–257)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, a guarantor, upon demand by Face Foundrie, must immediately make each payment required of the Area Developer under the Area Development Agreement. The guarantor waives any right to require Face Foundrie to take action against the Area Developer first, such as pursuing them for payment, seeking security from them, or exhausting other legal remedies. The guarantor also waives the right to receive notice of any demand for payment from the Area Developer.
This means that if the Area Developer fails to make a payment, Face Foundrie can immediately seek that payment from the guarantor without first attempting to collect from the Area Developer. This is a significant obligation for the guarantor, as they are essentially stepping in to ensure the Area Developer's financial responsibilities are met.
Furthermore, Face Foundrie can extend, modify, or release any debt or obligation of the Area Developer without notifying the guarantor, and the guarantor remains bound by any such changes to the agreement. The guarantor also agrees to defend, indemnify, and hold Face Foundrie harmless from any losses, damages, liabilities, costs, and expenses (including attorney's fees) arising from the Area Developer's failure to perform their obligations under the Area Development Agreement.
This section of the FDD highlights the importance of understanding the full scope of the guaranty and seeking legal counsel to fully understand the implications before signing. The guarantor is personally bound by all covenants in the Area Development Agreement, including those related to transfer restrictions and non-compete clauses, and acknowledges that the guaranty does not grant them any rights to use Face Foundrie's trademarks or system.