What is the role of the Guarantors in the Jersey Mikes Assignment of Area Development Agreement?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
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| By: Peter Cancro, Chief Executive Officer |
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A SUB ABOVE, LLC ASSIGNMENT OF AREA DEVELOPMENT AGREEMENT
This Assignment of Area Development Agreement is made by and between A Sub Above, LLC, a Delaware limited liability company having its principal place of business at 2251 Landmark Place, Manasquan, New Jersey 08736, (the "Franchisor"), [ORIGINAL DEVELOPER] (the "Assignor"), [NEW ENTITY], (the "Assignee"), and [GUARANTORS] (the "Guarantors"). This Assignment of Area Development Agreement shall take effect upon its execution and dating by Franchisor (the "Effective Date").
| WHEREAS, | Franchisor | and | Assignor | entered | into | a A | A Sul | b Above, | LLC | Area | Development |
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| Agreement on | , 20 | 0 (the ". | Area Dev | elop | mer | nt Agr | eement"); | and |
WHEREAS, the Assignor desires to assign its rights as Developer under the Area Development Agreement to the Assignee; and
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is acknowledged, the Franchisor, Assignor, Assignee, and Guarantors hereby agree as follows:
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- The Assignor hereby assigns all of its right, title and interest in the Area Development Agreement to the Assignee. The Franchisor hereby consents to this transfer. The Assignee hereby assumes and agrees to comply with all of the terms and conditions of the Area Development Agreement.
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- Sections 1 and 2 of the Summary Pages of the Franchise Agreement are hereby amended and restated as follows:
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- DEVELOPER(S):
Business Name (if partnership, corporation or LLC):
Names of Individual(s) with Ownership Interests in ADA:
Name(s) of Authorized Signatory or Signatories:
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- DEVELOPER(S)'S GUARANTOR(S):
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- The Franchisor, the Assignor, the Assignee, and Guarantors shall execute this Assignment which shall be attached to and become part of the Area Development Agreement.
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- Except as amended by this Assignment, the Area Development Agreement remains in full force and effect.
RELEASES. Developer, Guarantors, Assignor(s) and Assignee(s) jointly and severally release and forever discharge Company, its affiliates, and their respective heirs, successors, members, shareholders, partners, officers and directors, representatives, assigns, attorney, agents and employees, (collectively "Affiliates"), of and from any claims, debts, liabilities, demands, obligations, costs, expenses, actions and causes of action of every nature, character and description, known or unknown, vested or contingent, including without limitation, claims arising directly or indirectly related to (a) the Area Development Agreement and this Assignment Agreement (collectively the "Area Development Agreement"), (b) the entry into the Area Development Agreement, (c) the execution, delivery and performance of the Area Development Agreement, and (d) the Franchised Business, which Developer, Guarantors, Assignor(s) and Assignee(s) now own or hold or have at any time heretofore owned or held, or may at any time own or hold against Affiliates, arising prior to and including the Effective Date, including, but not limited to, all claims related to any violations of federal and state franchise, relationship, and business opportunity laws.
Each of the undersigned has executed this Assignment of Area Development Agreement as of the Effective Date below.
Peter Cancro, Chief Executive Officer Date: (Effective Date of Assignment of Area Development Agreement) ASSIGNOR: By:_____ Date: By: _____ ASSIGNEE: Date: Date: GUARANTORS: By:____ Date: By: _____
FRANCHISOR: A SUB ABOVE, LLC
A SUB ABOVE, LLC ASSIGNMENT OF AREA DEVELOPMENT AGREEMENT (California)
This Assignment of Area Development Agreement is made by and between A Sub Above, LLC, a Delaware limited liability company having its principal place of business at 2251 Landmark Place, Manasquan, New Jersey 08736, (the "Franchisor"), [ORIGINAL DEVELOPER] (the "Assignor"), [NEW ENTITY] (the "Assignee"), and [GUARANTORS] (the "Guarantors"). This Assignment of Area Development Agreement shall take effect upon its execution and dating by Franchisor (the "Effective Date").
WHEREAS, Franchisor and Assignor entered into a A Sub Above, LLC Area Development Agreement on , 20 (the "Area Development Agreement"); and
WHEREAS, the Assignor desires to assign its rights as Developer under the Area Development Agreement to the Assignee; and
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is acknowledged, the Franchisor, Assignor, Assignee, and Guarantors hereby agree as follows:
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to the 2025 Jersey Mikes FDD, the Guarantors play a crucial role in ensuring the obligations of the Area Development Agreement are met, even when the agreement is assigned to a new entity. The Guarantors agree to execute the Assignment, which becomes part of the Area Development Agreement. This indicates their consent and commitment to the transfer of rights and responsibilities from the original developer (Assignor) to the new developer (Assignee).
Specifically, each Guarantor personally and unconditionally guarantees that the Area Developer will fulfill every commitment outlined in the Area Development Agreement, including both monetary and non-monetary obligations. This includes guaranteeing payments and specific actions required by the agreement. The Guarantor is also considered a 'Principal' under the agreement, bound by all covenants, representations, warranties, and agreements applicable to Principals.
Furthermore, the Guarantors waive several rights, including the right to demand action against the Area Developer before being held liable themselves, and any defenses they might otherwise have. This underscores the Guarantor's direct and immediate liability, which is joint and several, meaning Jersey Mikes can pursue any or all Guarantors for the full amount of the obligation. The Guarantor's liability remains unaffected by any extensions of time or credit that Jersey Mikes might grant to the Area Developer. Finally, the Developer, Guarantors, Assignor(s) and Assignee(s) jointly and severally release Jersey Mikes from any claims related to the Area Development Agreement and its assignment.