Is a Chatime Developer permitted to sub-franchise or sub-license rights under the Franchise Agreement without prior written consent from the Franchisor?

According to the 2025 Chatime Franchise Disclosure Document, a Developer is not allowed to sub-franchise, sublicense, subcontract, share, divide, or partition rights under the Franchise Agreement without first obtaining written consent from Chatime. Chatime retains the right to withhold such consent at its discretion. This requirement ensures that Chatime maintains control over who is granted rights to operate Chatime stores and uphold brand standards within the designated development area.

This restriction is a standard practice in franchising, designed to protect the brand's reputation and ensure consistent quality across all franchise locations. By requiring prior consent, Chatime can vet potential sub-franchisees to ensure they meet the company's operational and financial standards. This helps to minimize the risk of brand dilution or operational issues that could arise from allowing unapproved parties to operate under the Chatime name.

For a prospective Chatime Developer, this means that they cannot delegate their development responsibilities or franchise rights to another party without explicit approval from Chatime. If a Developer wishes to transfer their rights, they must seek consent and adhere to Chatime's requirements for the transfer, which may include a review of the proposed sub-franchisee's qualifications and financial capabilities. This provision is in place to protect Chatime's interests and maintain the integrity of its franchise system.