Under the Goldfish Swim School Unlimited Guaranty, is the liability of the undersigned joint and several?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
Each of the undersigned consents and agrees that: (a) its direct and immediate liability under this Guaranty shall be joint and several; (b) it shall render any payment or performance required under the Agreement upon demand if Franchisee fails or refuses punctually to do so; (c) such liability shall not be contingent or conditioned upon pursuit by Franchisor of any remedies against Franchisee or any other person or entity; and (d) such liability shall not be diminished, relieved or otherwise affected by any extension of time, credit or other indulgence which Franchisor may from time to time grant to Franchisee or to any other person including, without limitation, the acceptance of any partial payment or performance, or the compromise or release of any claims, none of which shall in any way modify or amend this Guaranty, which shall be continuing and irrevocable during the term of the Agreement.
Source: Item 23 — RECEIPTS (FDD pages 77–389)
What This Means (2025 FDD)
According to the 2025 Goldfish Swim School FDD, the liability under the Guaranty is joint and several. This means that each individual or entity signing the Guaranty is independently liable for the full amount of the obligation. Goldfish Swim School Franchising LLC can pursue any one guarantor for the entire debt, regardless of whether other guarantors exist or their ability to pay.
For a prospective franchisee, this has significant implications. If multiple individuals or entities are acting as guarantors (for example, multiple partners in a franchise), each one is fully responsible for the entire debt. Goldfish Swim School Franchising LLC is not required to pursue all guarantors or divide the debt among them. This arrangement protects the franchisor by ensuring they can recover the full amount owed more easily.
The FDD specifies that the guarantor's liability is not contingent on Goldfish Swim School first pursuing remedies against the franchisee or any other person. Also, the liability remains unaffected by any extensions of time, credit, or other allowances the franchisor grants to the franchisee. This underscores the comprehensive and unconditional nature of the guaranty.
This type of clause is common in franchising to protect the franchisor's interests. Franchisees should fully understand the implications of a joint and several liability clause before signing any agreement, as it can expose them to significant financial risk if other guarantors are unable to meet their obligations.