Does the Hck Hot Chicken Guarantor waive rights to set-off, claims, or counterclaims?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
4. Specific Waivers.
- 4.1 Without limiting the generality of any other provision of this Continuing Guaranty, Guarantor expressly waives: (i) notice of the acceptance by Franchisor of this Continuing Guaranty; (ii) notice of the existence, creation, payment, nonpayment, performance or non-performance of all or any of the Obligations; (iii) presentment, demand, notice of dishonor, protest, notice of protest and all other notices whatsoever with respect to the payment or performance of the Obligations or the amount thereofor any payment or performance by Guarantor under this Agreement; (iv) all diligence in collection or protection of or realization upon the Obligations or any thereof, any obligation under this Agreement or any security for or guaranty of any of the foregoing; (v) any right to direct or affect the manner or timing of Franchisor's enforcement of its rights or remedies; (vi) any and all defenses which would otherwise arise upon the occurrence of any event or contingency described in Paragraph 1 hereof or upon the taking of any action by Franchisor permitted under this Agreement; (vii) any defense, right of set-off, claim or counterclaim whatsoever and any and all other rights, benefits, protections and other defenses available to Guarantor now or at any time hereafter, including, without limitation, under any suretyship statute of the State of California; and (viii) all other principles or provisions of law, if any, that conflict with the terms of this Continuing Guaranty, including, without limitation, the effect of any circumstances that may or might constitute a legal or equitable discharge of a guarantor or
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to Hck Hot Chicken's 2025 Franchise Disclosure Document, the Guarantor does waive rights to set-off, claims, or counterclaims. Specifically, the Guarantor waives "any defense, right of set-off, claim or counterclaim whatsoever and any and all other rights, benefits, protections and other defenses available to Guarantor now or at any time hereafter, including, without limitation, under any suretyship statute of the State of California". This waiver is part of a broader set of waivers detailed in the Continuing Guaranty.
This means that the Guarantor, who is providing a guarantee for the franchisee's obligations, gives up certain legal rights that could be used to defend against or reduce their obligations under the guarantee. This includes the right to assert any claims or counterclaims against Hck Hot Chicken, or to use set-off as a defense. Set-off is a legal defense where the Guarantor could reduce the amount they owe to Hck Hot Chicken by the amount that Hck Hot Chicken owes them.
The waiver extends to all rights, benefits, protections, and defenses available to the Guarantor, including those under any suretyship statute of California. This is a significant commitment, as it limits the Guarantor's ability to protect their interests in the event of a dispute or claim. The Guarantor also waives all other principles or provisions of law that conflict with the terms of the Continuing Guaranty, including any circumstances that might constitute a legal or equitable discharge of a guarantor.
For a prospective Hck Hot Chicken franchisee, it is crucial to understand the implications of this waiver for any individual acting as a Guarantor. The Guarantor should seek legal counsel to fully understand the extent of the obligations and the rights being waived. This is a common practice in franchising, as franchisors seek to ensure that the obligations under the franchise agreement are fully secured.