Who must sign and deliver the Chatime franchise agreement on behalf of the Franchisee?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (5) When the assignee is a company, those directors and shareholders or other Affiliates of the assignee nominated by Franchisor each:
- (a) Executed and deliver a personal guarantee and indemnity and undertake similar personal restraints to those given by Guarantor under this Agreement in favor of, and in the form attached as Exhibit 3;
- (b) Executed and deliver a confidentiality and non-competition agreement in the form attached as Exhibit 4; and
- (c) Execute the new franchise agreement or assignment in their personal capacities;
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
Based on the 2025 Chatime Franchise Disclosure Document, when an assignee is a company, certain individuals must execute and deliver specific agreements. Specifically, those directors and shareholders or other Affiliates of the assignee nominated by Chatime must execute and deliver a personal guarantee and indemnity, a confidentiality and non-competition agreement, and the new franchise agreement or assignment in their personal capacities.
This requirement ensures that individuals with significant control or ownership in the company taking over the Chatime franchise are personally bound by the obligations and restrictions outlined in these agreements. This provides Chatime with an added layer of security and recourse in case of non-compliance or breach of contract.
For a prospective franchisee, especially those operating under a corporate structure, it's crucial to understand that directors, shareholders, and potentially other affiliated parties may be required to personally guarantee the franchise agreement and adhere to confidentiality and non-competition terms. This personal obligation extends to executing the new franchise agreement or assignment, signifying their direct commitment to the franchise's success and adherence to Chatime's standards.