For a Churchs Chicken franchise, what happens if any 5% Owner is not an individual?

According to Churchs Chicken's 2025 Franchise Disclosure Document, if any owner with at least 5% ownership is not an individual, Churchs Chicken has the right to require a guaranty to be executed by individuals who have an indirect ownership interest in the developer.

This means that if a franchisee's ownership structure includes entities rather than solely individuals, Churchs Chicken can ensure that individuals ultimately tied to the ownership are held responsible via a guaranty. This is a protective measure for Churchs Chicken, ensuring accountability for the franchise's obligations.

For a prospective franchisee, this implies that if your ownership involves a company or other non-individual entity, you should be prepared to have individual guarantors who are indirectly connected to the ownership to sign a guaranty. This requirement aims to provide Churchs Chicken with recourse to specific individuals in case of any default or breach of the franchise agreement.