What obligations of the Developer are guaranteed by the Guarantor to Stretch Zone and its affiliates?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
TERMS
The Guarantor agrees for the benefit of the Franchisor and its affiliates as follows:
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- Guaranteed Obligations. The Guarantor absolutely and unconditionally, guarantees to the Franchisor and its affiliates, and their respective successors and assigns, for the respective terms of the Agreements and thereafter as provided in the Agreements, that the Developer will punctually pay and perform every obligation stated in the Agreements, and the Guarantor agrees to be personally bound by, and personally liable for the breach of, every term of the Agreements, together with charges, fees and all expenses including attorneys' fees and costs incurred in enforcing the terms of the Agreements or this Guaranty through litigation, arbitration, appellate, bankruptcy and post-judgment proceedings (the "Guaranteed Obligations").
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- Incorporation of Terms. The terms of the Agreements are incorporated in this Guaranty as if stated in full, including the dispute resolutions provisions stated in Section 8.1 of the Area Development by which Guarantor agrees to be bound. The Guarantor has had an opportunity to read, and to receive advice by his or her counsel of, the terms of the Agreements and the Franchisor's Franchise Disclosure Document.
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- Guaranty Absolute and Irrevocable. The obligation of the Guarantor is absolute and unconditional irrespective of the validity or enforceability of any of the Agreements. This is an irrevocable and continuing guaranty. This Guaranty covers and secures any amount at any time owing on the Guaranteed Obligations and remains in full effect until all Guaranteed Obligations have been satisfied and all amounts due have been paid in full to the Franchisor or its affiliates. The Guarantor waives the benefit of any circumstance, defense or statute of limitations affecting
her/his liability that might otherwise discharge a guarantor or hinder prompt enforcement of this Guaranty. The Guarantor irrevocably waives any requirement that the Franchisor must proceed against or exhaust any collateral or security that the Franchisor may now hold or obtain for any of the Guaranteed Obligations before collecting from the Guarantor. The Franchisor is under no obligation to keep the Guarantor informed of the Developer's financial condition.
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the Guarantor provides an absolute and unconditional guarantee to Stretch Zone and its affiliates that the Developer will fulfill every obligation outlined in the Agreements. This guarantee extends for the duration of the Agreements and beyond, as specified within those Agreements. The Guarantor commits to being personally bound by and liable for any breaches of the Agreements' terms. This includes responsibility for all associated charges, fees, and expenses, such as attorneys' fees and costs, incurred while enforcing the Agreements or the Guaranty itself through various legal proceedings like litigation, arbitration, appeals, bankruptcy, and post-judgment actions. These financial and performance obligations are collectively referred to as the "Guaranteed Obligations."
The terms of the Agreements are incorporated into the Guaranty, making the Guarantor subject to all provisions as if they were fully stated in the Guaranty, including dispute resolution processes detailed in the Area Development agreement. The Guarantor confirms they have had the opportunity to review and seek legal counsel regarding the terms of both the Agreements and Stretch Zone's Franchise Disclosure Document. This acknowledgment underscores that the Guarantor is fully aware of the obligations they are undertaking.
The Guarantor's obligation is absolute and remains in effect regardless of the validity or enforceability of the Agreements themselves. This guarantee is both irrevocable and continuous, securing any amount owed at any time under the Guaranteed Obligations. It remains in full force until all Guaranteed Obligations are completely satisfied and all due amounts are paid to Stretch Zone or its affiliates. The Guarantor also waives any rights to defenses or statutes of limitations that could otherwise affect their liability or impede the prompt enforcement of the Guaranty. Furthermore, the Guarantor relinquishes any requirement that Stretch Zone must first pursue action against the Developer or exhaust any collateral or security before seeking collection from the Guarantor. Stretch Zone is not obligated to keep the Guarantor informed about the Developer's financial status.