According to Chatime's 2025 Franchise Disclosure Document, if a new Interested Party becomes involved with a Chatime franchise, they must sign a guarantee and indemnity. This guarantee and indemnity must cover the franchisee's obligations under the Franchise Agreement, and it must be based on the current terms used by Chatime at that time. The specific form for this guarantee and indemnity is attached as Exhibit 3 to the Franchise Agreement.

In simpler terms, this means that if someone becomes an 'Interested Party' (which could be a partner, investor, or other involved individual) after the franchise agreement is already in place, they also need to provide a personal guarantee. This guarantee ensures that the franchisee meets all of their financial and operational responsibilities outlined in the agreement. The new Interested Party is essentially vouching for the franchisee's performance.

This requirement protects Chatime by ensuring that all individuals with a significant stake in the franchise are personally liable for its success and compliance. It also aligns the interests of all Interested Parties with those of the franchisor, encouraging them to work together to uphold the standards and obligations of the franchise agreement. Prospective franchisees should carefully review Exhibit 3 and understand the full scope of the guarantee and indemnity before allowing anyone to become a new Interested Party.