What is the definition of 'Offer Period' regarding the sale of a Chatime franchise?

According to the 2025 Chatime Franchise Disclosure Document, the 'Offer Period' refers to the 45-day window after Chatime receives an Offer Notice from a franchisee or developer who has received an offer from a third party to purchase their business. This clause dictates the process by which a franchisee can sell their Chatime business to a third party.

During this 45-day Offer Period, Chatime has the first right of refusal to purchase the business on the same terms as the third-party offer. Chatime can issue an Acceptance Notice to the franchisee before the Offer Period concludes, which means Chatime agrees to buy the business. The Acceptance Notice may include varied terms, provided they are not commercially less favorable to the franchisee than the original Offer Notice. For instance, if the original offer involves consideration that Chatime cannot reasonably match, Chatime can offer the equivalent in cash.

If Chatime does not accept the offer within the 45-day Offer Period, the franchisee is then entitled to proceed with the sale to the third party. However, this sale must occur within 60 days after the end of the Offer Period, and the terms cannot be less favorable than those initially presented to Chatime in the Offer Notice. Should the franchisee fail to sell the business within this 60-day window, Chatime's rights are revived, and the franchisee must again offer the business to Chatime before any subsequent sale to a third party.

This process ensures that Chatime retains control over who joins their franchise system and maintains the brand's standards. It also provides a structured approach for franchisees looking to exit their business, balancing their interests with Chatime's strategic objectives.