Under the Monicals Pizza Unlimited Guaranty and Assumption of Obligations, what agreement is it connected to?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
GATIONS
| THIS UNLIMITED GUARANTY AND ASSUMPTION OF OBLIGATIONS is given this day |
|---|
| of, 20 |
| , in connection with that certain Franchise Agreement of even date herewith (which Franchise |
| Agreement, as may have been modified, amended and/or supplemented in writing, is hereunder called the Franchise |
| Agreement) by and between Monical Pizza Corporation as "Franchisor" and |
| as "Franchisee". |
As used herein, "Related Agreement" shall mean any agreement entered into by and between Franchisor and Franchisee or any Affiliate (as defined in the Franchise Agreement) in connection with or relating to the Franchise Agreement.
For valuable consideration received, and as an inducement to Franchisor to enter into the Franchise Agreement, the undersigned ("Guarantor") hereby unconditionally guarantees to Franchisor and its Affiliates: (a) the full and timely performance by Franchisee of the Franchise Agreement and each related Agreement and all terms, conditions and covenants thereof, and (b) the payment by Franchisee of royalties and all other sums payable by Franchisee under the Franchise Agreement and each Related Agreement.
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to the 2025 Monicals Pizza Franchise Disclosure Document, the Unlimited Guaranty and Assumption of Obligations is connected to either the Franchise Agreement or the Development Agreement. Specifically, for franchisees, the guaranty is tied to "that certain Franchise Agreement of even date herewith".
This means that individuals or entities with a significant financial stake (5% or greater) in a Monicals Pizza franchise must sign a guarantee, ensuring they are personally liable for the franchisee's obligations under the Franchise Agreement. This protects Monicals Pizza by providing an additional layer of security, as the franchisor can pursue the guarantor's assets if the franchisee fails to meet their financial or contractual responsibilities.
For developers, the guaranty is tied to "that certain Development Agreement of even date herewith". The guarantor ensures the developer's performance and payments under the Development Agreement and any related agreements. This is a common practice in franchising, especially when dealing with area developers, as it ensures the franchisor has recourse beyond the developer's business entity.