In the Mr. Sandless franchise agreement, besides the franchisee, who else is required to sign as a principal?

According to the 2025 Mr. Sandless Franchise Disclosure Document, if the franchisee is a corporation or limited liability company, certain individuals associated with that entity must also sign a Guaranty Agreement. Specifically, all shareholders of a corporation or all members and managers of a limited liability company must sign the Guaranty Agreement, agreeing to be personally bound by the terms of the Franchise Agreement and guaranteeing the franchisee's performance of all obligations. This requirement ensures that individuals with a vested interest in the franchisee entity are personally liable for the franchise's obligations.

This condition is applicable when the franchisee is not an individual but a business entity. Mr. Sandless requires this to ensure that there is personal accountability for the franchise's performance, even when the franchise is operated through a corporation or LLC. This is a common practice in franchising to prevent individuals from shielding themselves completely behind a corporate structure.

For a prospective Mr. Sandless franchisee, this means that if they plan to operate the franchise through a corporation or LLC, they must ensure that all shareholders, members, and managers are willing to sign the Guaranty Agreement. This could have implications for the ownership structure and the willingness of individuals to participate in the franchise, as it exposes them to personal liability. The franchisee should discuss this requirement with their legal and financial advisors to fully understand the implications before proceeding with the franchise agreement.