Is the Guaranty an original and independent obligation of the Guarantor, separate from the Franchisee's obligations to the Franchisor for a Buona franchise?

According to Buona's 2025 Franchise Disclosure Document, the Guaranty is indeed an original and independent obligation of the Guarantor, separate from the Franchisee's obligations to Buona under the Franchise Agreement. Specifically, the FDD states that the obligations of the Guarantor to Buona are direct and primary, regardless of the validity or enforceability of the Franchise Agreement. This means that Buona can pursue the Guarantor directly for the Franchisee's obligations, even if the Franchise Agreement itself is somehow deemed invalid.

This aspect of the Guaranty has significant implications for anyone acting as a Guarantor for a Buona franchise. The Guarantor's obligations are not contingent on the Franchisee's ability to pay or perform; instead, the Guarantor is independently responsible. This is a critical point, as it means the Guarantor's assets are at risk should the Franchisee default, irrespective of the circumstances surrounding the default or the enforceability of the original agreement.

Furthermore, the Guaranty benefits only Buona and not any third party. This reinforces the direct relationship between the Guarantor and Buona, solidifying Buona's ability to seek recourse directly from the Guarantor. The Guaranty remains in effect until all obligations of the Guarantor to Buona have been fully performed, meaning the Guarantor's responsibility extends throughout the entire term of the Franchise Agreement and until all debts are settled. This is a standard practice in franchising, as it provides the franchisor with an additional layer of financial security.