Where can I find copies of the guarantees that Checkersrallys requires from owners of legal entities?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are a corporation, limited liability company, partnership or any other type of legal entity, the provisions of the Franchise Agreement (and, if applicable, the Development Agreement) also apply to your owners by virtue of the requirement that all your owners personally guarantee, and be personally bound by, your obligations under the Franchise Agreement (or, if applicable, the Development Agreement).
You agree to require and obtain the execution of a non-disclosure and non-competition agreement, as we may require at our sole discretion, from all of the following persons:
- (b) If you are a business entity, all Owners with at least a ten percent (10%) direct or indirect legal or beneficial ownership interest in you; all of your officers, directors and managers; and, all persons possessing equivalent positions in any business entity which directly or indirectly owns and/or controls you.
You shall procure all such Nondisclosure and
Non-Competition Agreements no later than ten (10) days following the Effective Date (or, if any individual or entity attains any status identified above after the Effective Date, within ten (10) days after such individual or entity's attains such status) and shall furnish to us copies of all executed Nondisclosure and Non-Competition Agreements within ten (10) days following their execution.
Each person who is or becomes an Owner must execute an agreement in form as we prescribe, undertaking to be bound jointly and severally by the terms of this Agreement.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 64–65)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if a franchisee is a corporation, limited liability company, partnership, or any other type of legal entity, the owners are required to personally guarantee and be personally bound by the obligations under the Franchise Agreement or Development Agreement.
Furthermore, Checkersrallys requires franchisees to obtain a non-disclosure and non-competition agreement from all owners with at least a ten percent (10%) direct or indirect legal or beneficial ownership interest in the business entity. This also applies to all officers, directors, and managers, and all persons possessing equivalent positions in any business entity which directly or indirectly owns and/or controls the franchisee. Franchisees must provide Checkersrallys with copies of all executed Nondisclosure and Non-Competition Agreements within ten (10) days following their execution.
While the FDD specifies these requirements, it does not include the actual forms or where to find them. It indicates that each person who is or becomes an Owner must execute an agreement in a form as Checkersrallys prescribes, undertaking to be bound jointly and severally by the terms of the Franchise Agreement. To obtain copies of the specific guarantee agreements and non-disclosure/non-competition agreements, a prospective franchisee should directly ask Checkersrallys during the due diligence process.