Does the Guarantor have the right to limit or qualify the terms of the Guaranty in any way for a Buona franchise?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Guarantor's Representations and Warranties.
Guarantor(s) represents and warrants to Franchisor that: (a) no representations or agreements of any kind have been made to Guarantor which would limit or qualify in any way the terms of this Guaranty; (b) this Guaranty is executed at Franchisee's request and Franchisor would not execute the Franchise Agreement were it not for the execution and delivery of this Guaranty; (c) Guarantor has not and will not, without the prior written consent of Franchisor, sell, lease, assign, encumber, hypothecate, transfer or otherwise dispose of all, or substantially all, of Guarantor's assets, or any interest therein if any such event would have a material negative effect on Guarantor's ability to perform its obligations under this Guarantor or the Franchise Agreement; (d) neither the execution nor the delivery of this Guaranty, nor compliance with the terms hereof, will conflict with or result in the breach of any law or statute, will constitute a breach or default under any agreement or instrument to which Guarantor may be a party, or will result in the creation or imposition of any charge or lien upon any property or assets of Guarantor; (e) Franchisor has made no representation to Guarantor as to the creditworthiness of Guarantor; and (f) Guarantor has established adequate means of obtaining from Franchisee, on a continuing basis, information regarding Franchisee's financial condition.
Guarantor agrees to keep adequately informed of any facts, events or circumstances which might in any way affect Guarantor's risks under this Guaranty, and Guarantor further agrees that, absent a request for information from Guarantor, Franchisor shall have no obligation to disclose to Guarantor any information or documents acquired by Franchisor in the course of its relationship with Franchisee.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the Guarantor does not have the right to limit or qualify the terms of the Guaranty. The Guarantor provides representations and warranties to Buona, affirming that no agreements have been made that would limit or qualify the Guaranty's terms.
Specifically, the Guarantor represents and warrants that no such limiting agreements exist. This warranty is crucial for Buona, as it states that the Franchise Agreement would not be executed without the Guaranty's execution and delivery. This highlights the importance Buona places on the Guaranty as a condition for granting a franchise.
The Guarantor also agrees not to dispose of their assets if it would negatively affect their ability to fulfill their obligations under the Guaranty or the Franchise Agreement, without Buona's prior written consent. Furthermore, the Guarantor is responsible for staying informed about any circumstances that might affect their risks under the Guaranty. Buona has no obligation to disclose information to the Guarantor unless specifically requested.