When does the guarantor affix their signature to the Aw Guaranty and Assumption of Obligations?

According to Aw's 2025 Franchise Disclosure Document, the guarantor must affix their signature to the Guaranty and Assumption of Obligations on the same day and year that the Franchise Agreement is executed. This requirement ensures that the obligations of the guarantor are legally binding from the outset of the franchise relationship. The Guaranty and Assumption of Obligations is attached as Exhibit 2 to the Franchise Agreement.

This means that if a franchisee is an entity, all owners of that entity must sign the Guaranty and Assumption of Obligations upon the execution of the Franchise Agreement. This ensures that Aw has recourse to the personal assets of the owners should the franchisee entity fail to meet its obligations under the agreement. The guarantor is essentially agreeing to be personally liable for the franchisee's performance and adherence to the terms of the Franchise Agreement.

For a prospective Aw franchisee, this requirement highlights the importance of understanding the full scope of the financial and operational commitments involved in the franchise. Individuals considering becoming owners of a franchisee entity should carefully review the Guaranty and Assumption of Obligations with legal counsel to fully understand their personal liability and responsibilities. This is a standard practice in franchising, as franchisors typically seek to ensure that there are individuals with a vested interest in the success of the franchise who are willing to stand behind the entity's obligations.