Who is required to sign the 'Personal Guaranty Agreement' (Exhibit I) for an Afuri Ramen Dumpling franchise?

According to the 2024 Afuri Ramen Dumpling FDD, if the franchisee is a corporation, limited liability company, or other business entity, the agreement must be signed by a company officer or owner authorized to sign on behalf of the company. In addition, all officers and owners of the company must sign the agreement as individuals.

This requirement means that if a franchisee chooses to operate their Afuri Ramen Dumpling franchise through a business entity rather than as an individual, the franchisor, Afuri Franchise Inc., requires personal guarantees from the company's leadership. This is a common practice in franchising, as it ensures that the franchisor has recourse to the personal assets of the individuals behind the business entity, should the franchise fail to meet its financial obligations.

The Personal Guaranty Agreement included as Exhibit I to the FDD also stipulates that each person signing waives certain rights, including the right to require the franchisor to first pursue action against the franchisee or any other person before seeking fulfillment of the guaranty. This further protects Afuri Franchise Inc. by streamlining their ability to collect on any guaranteed debt or obligation.