What is an 'Event' in the context of the Chatime Force Majeure clause?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- 22.1 A party (Affected Party) is not liable for any delay or failure to perform an obligation (other than to pay money) under this Agreement caused by:
- (1) Act of God;
- (2) War, terrorism, riot, insurrection, vandalism, or sabotage;
- (3) Strike, lockout, ban, limitation of work, or other industrial disturbance; or
- (4) Law, rule, or regulation of any government or governmental agency and executive or administrative order or act of general or particular application.
- 22.2 The Affected Party must notify each other party as soon as practical of any anticipated delay or failure caused by an event referred to in clause 22.1 (Event).
- 22.3 The performance of the Affected Party's obligation (other than to pay money) is suspended for the period of delay caused by the Event.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, an 'Event' in the context of the Force Majeure clause refers to specific circumstances that excuse a party from liability for delays or failures to perform their obligations under the franchise agreement, excluding the obligation to pay money.
The listed events include acts of God, encompassing natural disasters and unforeseen calamities. It also covers man-made disruptions such as war, terrorism, riot, insurrection, vandalism, or sabotage, highlighting the potential for political and social unrest to impact business operations. Furthermore, the definition extends to labor-related issues like strikes, lockouts, bans, limitations of work, or other industrial disturbances, acknowledging the importance of stable labor relations.
Finally, an 'Event' includes any law, rule, or regulation issued by a government or governmental agency, as well as executive or administrative orders. This acknowledges that changes in the legal and regulatory landscape can significantly impact a Chatime franchisee's ability to operate their business. If any of these events occur, the affected party must promptly notify the other party, and their performance of the obligation is suspended for the duration of the delay caused by the event.