Can the officers, directors, shareholders, partners and members of a Bambu franchise be required to sign an agreement guaranteeing the franchisee's obligations?

According to Bambu's 2025 Franchise Disclosure Document, you and each of your officers, directors, shareholders, partners, and members may be required to sign an agreement personally guaranteeing and agreeing to perform all obligations of the franchisee under the Franchise Agreement. This agreement is included as Attachment II to the Franchise Agreement.

Attachment II, titled "Guaranty and Assumption of Franchisee's Obligations," outlines the terms of this personal guarantee. By signing, these individuals unconditionally guarantee to Bambu that the franchisee will punctually pay and perform every obligation set forth in the Franchise Agreement for the entire term, including any successor terms. They also agree to be personally bound by and liable for any breach of the agreement, including terms related to noncompetition, confidentiality, and the use of Bambu's trademarks and copyrighted materials.

The guaranty includes a waiver of several rights, such as the right to receive notice of acceptance of the guarantee, notice of demand for payment or nonperformance, and the right to require Bambu to first take action against the franchisee before pursuing the guarantors. This means that Bambu can seek recourse directly from the guarantors without first pursuing the franchisee. This is a significant commitment, as it puts the personal assets of these individuals at risk if the franchise fails to meet its obligations under the Franchise Agreement.