Does the definition of 'Disposal' for a Chatime franchise include bequeathing the franchise?

According to Chatime's 2025 Franchise Disclosure Document, the definition of "Disposal" includes bequeathing the franchise. The FDD specifies that a transfer, defined as a disposal, encompasses any voluntary, involuntary, direct, or indirect sale, assignment, pledge, bequeath, trade, or transfer. This broad definition means that if a Chatime franchisee wishes to pass their franchise to an heir through a will, it is considered a transfer or disposal of the franchise.

This has significant implications for prospective Chatime franchisees. Because bequeathing is included in the definition of disposal, the franchisee must adhere to the transfer conditions outlined in the Franchise Agreement. These conditions typically include obtaining Chatime's prior written consent, which will not be unreasonably withheld.

Chatime may also impose conditions on the transfer, such as ensuring the transferee meets Chatime's standards, payment of a transfer fee and associated costs, ensuring the franchisee is not in default, requiring the transferee to sign the current Franchise Agreement or an assignment, and requiring the transferee to provide a guarantee and indemnity. These conditions are typical in franchising to ensure brand consistency and the continued success of the franchise system. Therefore, a Chatime franchisee needs to be aware of these requirements when planning for the future of their franchise and estate.