Does the Buns On Fire FDD include a Guaranty as Exhibit B?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
EXHIBITS:
Exhibit A Location Addendum
Exhibit B. Guaranty (to Franchisor)
Exhibit C. Conditional Lease Assignment Provisions
Exhibit D. Site Location Addendum
Exhibit E. Internet, Website, and Telephone Listing Agreement
Exhibit F. State Specific Addendum
Exhibit G. Franchisee Disclosure Acknowledgement Statement
Exhibit H. Questionnaire
Exhibit I. Training Completion Agreement and Release
Exhibit J. [Reserved].
Exhibit K. Guaranty (Exclusive Supplier)
Exhibit L. Electronic Transfer Authorization
Exhibit M. Power of Attorney
Exhibit N. ADA Certificate
Source: Item 23 — RECEIPTS (FDD pages 49–200)
What This Means (2025 FDD)
According to the 2025 Buns On Fire Franchise Disclosure Document, Exhibit B is indeed a Guaranty to the Franchisor. This means that the FDD includes a specific form or agreement that may require a personal guarantee from the franchisee or another party. This guaranty would ensure that the obligations of the franchisee under the Franchise Agreement are met, even if the franchisee's business entity cannot fulfill them.
Typically, a guaranty in a franchise agreement makes an individual (often the franchisee or a principal of the franchisee) personally liable for the debts and obligations of the franchise. This is a common practice in franchising, especially when the franchisee is a newly formed business entity with limited assets. The franchisor seeks assurance that someone with sufficient assets will stand behind the financial commitments of the franchise.
Prospective Buns On Fire franchisees should carefully review Exhibit B with their legal counsel to fully understand the scope and implications of the guaranty. They should be aware of the specific obligations they would be guaranteeing and the potential risks to their personal assets. Understanding the conditions under which the guaranty can be invoked is crucial for any franchisee considering signing such a document.