Under the Floyds 99 guaranty, what are 'Franchisor Affiliates' defined as?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
In consideration of, and as an inducement to, the execution of the above Franchise Agreement (the "Agreement") by Floyd's 99 Franchising, LLC (the "Franchisor"), each of the undersigned hereby personally and unconditionally:
Guarantees to the Franchisor and its affiliates and their respective successors and assigns, for the term of the Agreement and thereafter as provided in the Agreement, that the Franchisee as that term is defined in the Agreement (the "Franchisee") shall punctually pay and perform each and every undertaking, agreement and covenant set forth in the Agreement; and
Source: Item 22 — CONTRACTS (FDD pages 57–58)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, the guaranty provided by franchisees extends to the Franchisor and its affiliates, along with their respective successors and assigns. This means that the personal guarantee isn't just for the benefit of Floyds 99 Franchising, LLC, but also for any related companies or entities that are considered affiliates.
In practical terms, this implies that if Floyds 99 assigns the franchise agreement to an affiliate, the franchisee's obligations under the guarantee would continue to apply to that affiliate. Similarly, if Floyds 99 is acquired or merged with another company, the guarantee would extend to the successor entity. This is a fairly standard practice in franchising, as it protects the franchisor's interests in the event of corporate restructuring or ownership changes.
Prospective franchisees should carefully consider the implications of this broad guarantee, as it could expose them to liability not only to Floyds 99 itself but also to any related entities. It would be prudent to seek legal counsel to fully understand the scope of the guarantee and its potential impact on their personal assets.