Does the Franchisor require the execution and delivery of the Guaranty before executing the Franchise Agreement for a Buona franchise?

According to Buona's 2025 Franchise Disclosure Document, the execution of the Guaranty and Assumption of Obligations is required concurrently with the execution of the Area Development Agreement. Specifically, all Owners of the Developer entity must execute the Guaranty and Assumption of Obligations, which is attached as Exhibit C to the Area Development Agreement. This execution must occur at the same time the Developer signs the Area Development Agreement.

In practical terms, this means that if you are pursuing an Area Development Agreement with Buona, all individuals listed as Owners of the developing entity must sign the Guaranty and Assumption of Obligations at the same time the development agreement is signed. This ensures that the obligations under the Area Development Agreement are personally guaranteed by the Owners.

This requirement is a fairly standard practice in franchising, as it provides the franchisor with additional security and recourse in case the franchisee entity fails to meet its obligations. By having all Owners personally guarantee the agreement, Buona aims to ensure a strong commitment from the franchisee and to protect its interests in the development area.