Where is the 'Development Area' for a Chatime franchise specified?

According to Chatime's 2025 Franchise Disclosure Document, the specific details of the 'Development Area' are found in Schedule 1 of the Multi-Unit Development Agreement. The franchisor grants the developer the right to operate Chatime stores within this defined Development Area for an initial term, subject to the agreement's terms and conditions. The developer is not allowed to operate or grant franchises outside of this designated area.

Chatime retains certain rights within and outside the Development Area, including operating or franchising outlets through alternative channels like airports, train stations, and online platforms. They can also establish Chatime stores outside the Development Area, even near its boundaries. This means that while a developer has exclusive rights within their area, Chatime can still operate or franchise outside of it, potentially impacting the developer's business.

The developer must adhere to a Development Quota, opening and operating a specific number of outlets within the Development Area during each Development Period. The franchisor determines whether these obligations have been met based on the number of operating outlets. The Development Fee paid by the developer serves as a credit against the Initial Franchise Fee for each outlet they agree to open, but this fee is non-refundable, regardless of how many outlets are actually opened.

Prospective franchisees should carefully review Schedule 1 of the Multi-Unit Development Agreement to fully understand the scope and limitations of their Development Area, as well as Chatime's retained rights and the specific development obligations they must meet. Understanding these details is crucial for assessing the potential and risks associated with the franchise opportunity.