Is Buona obligated to cure any defaults on behalf of the Guarantor?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Cure Defaults.
Franchisor may, but without any obligation to do so, cure any defaults, including without limitation, paying any unpaid bills and liens, including without limitation those for construction, labor, and materials.
Guarantor, upon Franchisor's demand, shall promptly pay to Franchisor all such sums expended together with interest thereon at the lesser of the rate of 1.5% per month or the highest rate of interest allowable under applicable law.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Buona is not obligated to cure any defaults on behalf of the guarantor. While Buona has the option to cure defaults, they are not required to do so. Specifically, Buona may choose to pay unpaid bills and liens related to construction, labor, and materials, but there is no obligation for them to take such actions.
If Buona chooses to cure any defaults, the guarantor is responsible for promptly paying Buona all sums expended, along with interest. The interest rate will be the lesser of 1.5% per month or the highest rate permitted by applicable law.
This lack of obligation on Buona's part means that the guarantor remains primarily responsible for addressing any defaults. Prospective franchisees should understand that the responsibility for curing defaults ultimately falls on the guarantor, and they should be prepared to fulfill this obligation.