What are the implications if the franchisee of a Carbones Pizzeria is a partnership?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
To simplify the language in this disclosure document, "we", "us", "our" and "M & T Pizza" means M & T Pizza Incorporated, the corporation which is offering the franchise and is sometimes called the "Franchisor." "You" or "your" means the person who or entity that buys the franchise and is sometimes called the "Franchisee." If the Franchisee is a corporation, partnership, limited liability company, or other business entity, "you" includes the franchisee's owners and each of your owners must sign a personal guaranty agreeing to comply with all provisions of the Franchise Agreement.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD page 23)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, if the franchisee is a partnership, each owner must sign a personal guarantee. This means that each partner in the franchisee entity must agree to be personally liable for the Carbones Pizzeria franchise's obligations under the Franchise Agreement. This is a common practice in franchising, as it ensures that the franchisor has recourse to the personal assets of the business owners if the franchise fails to meet its financial or contractual obligations.
This requirement extends beyond partnerships to other business entities as well. If the franchisee is a corporation, limited liability company, or other business entity, each of the franchisee's owners must sign a personal guaranty. This ensures that all individuals with an ownership stake in the Carbones Pizzeria franchise are personally committed to upholding the terms of the Franchise Agreement.
For prospective Carbones Pizzeria franchisees, this personal guarantee is a significant consideration. It means that their personal assets are at risk if the franchise does not perform well or if the business violates the Franchise Agreement. Franchisees should carefully consider the financial risks and obligations associated with the franchise before signing the Franchise Agreement and the personal guarantee.