Must all owners of the proposed assignee provide a guaranty to Bombs Away Franchising?

According to Bombs Away's 2024 Franchise Disclosure Document, if a franchisee wishes to transfer their franchise, all owners of the proposed assignee must provide a guaranty to Bombs Away Franchising. This guaranty must be in accordance with Section 2.5 of the franchise agreement.

This requirement ensures that Bombs Away has recourse against the owners of the entity taking over the franchise, providing an additional layer of security for the franchisor. This is a fairly standard practice in franchising, as it ensures that individuals with a vested interest in the business are personally liable for its performance and adherence to the franchise agreement.

For a prospective Bombs Away franchisee, this means that if they plan to sell or transfer their franchise in the future, the individuals or entities acquiring the franchise will need to be prepared to provide a personal guaranty. This could impact the pool of potential buyers, as some individuals may be unwilling to take on this level of personal liability. Franchisees should carefully consider this requirement and discuss it with potential buyers during any transfer negotiations.