Does the Chatime FDD specify who the Guarantor(s) must be?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
ember 31, 2024 and 2023, respectively. Management does not expect these balances to be settled within the next year.
Exhibit B to the Franchise Disclosure Document CHATIME FRANCHISE AGREEMENT
Chatime Franchise Agreement (United States of America)
Parties: Chatime Franchise, LLC (Franchisor)
Franchisee specified in Schedule 1 (Franchisee)
Guarantors specified in Schedule 1 (Guarantor)
Contents
| 2 Grant of Rights and Development Obligations .99 3 Training and Operating Assistance .12 4 Franchisee's Operational Obligations .14 5 Other Obligations of Franchisee .18 6 Initial a
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the identity of the guarantor is specified in Schedule 1 of both the Franchise Agreement and the Multi-Unit Development Agreement. This means that who is required to act as a guarantor is determined on a case-by-case basis and outlined in the agreement's schedule.
Specifically, when a Chatime developer seeks to assign their rights and obligations to another party, the directors, owners, or other affiliates of the assignee nominated by Chatime must execute and deliver a personal guarantee and indemnity, undertaking similar personal restraints to those given by the Guarantor under the agreement. They must also provide a confidentiality and non-competition agreement in Chatime's current form.
Furthermore, the FDD states that any Interested Party specified by Chatime must enter into a noncompete and confidentiality agreement with Chatime. This agreement should contain similar reasonable restraints as imposed on the Developer and Guarantor, along with confidentiality obligations.