According to the Buona Guaranty, what makes the Guaranty effective?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISIONS OF THIS GUARANTY AND AGREES TO ITS TERMS. GUARANTOR UNDERSTANDS THAT EFFECTIVE. THIS GUARANTY IS DATED AS OF, 20 | THE UNDERSIGNED GUARANTOR(S) ACKNOWLEDGES HAVING READ ALL THE IN ADDITION, THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND DELIVERY OF THIS GUARANTY TO FRANCHISOR. NO FORMAL ACCEPTANCE BY FRANCHISOR IS NECESSARY TO MAKE THIS GUARANTY |
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Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the Guaranty becomes effective once the guarantor executes and delivers it to Buona. No formal acceptance from Buona is required to make the Guaranty effective. The Guaranty is dated as of 20[xx].
This means that once a guarantor signs and delivers the Guaranty, they are bound by its terms, regardless of whether Buona formally acknowledges or approves it. This places the onus on the guarantor to fully understand the implications of the Guaranty before signing, as their obligations begin immediately upon execution and delivery.
Prospective Buona franchisees should carefully review the Guaranty with legal counsel to fully understand their obligations and potential liabilities. They should also ensure that all guarantors are aware of the terms and conditions before they sign and deliver the document to Buona.