Where in the Chatime FDD can I find information about other obligations of the franchisee?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: Receipts]
- (m) develop, manufacture, distribute, and/or sell Raw Materials and other Products through any channel of distribution (including, without limitation, via the Internet) under or in association with the Marks or any other trademark.
2.4 Development Obligations
(1) Franchisee agrees that during the Initial Term, it will at all times faithfully, honestly, and diligently perform its obligations under this Agreement to open and operate the Franchised Business at the Premises, and will continuously use its best efforts to promote and enhance the Chatime Network Name.
2.5 Subcontracting
This Agreement is predicated on the ongoing, direct, and exclusive involvement of Franchisee in the Franchised Business. No person other than an employee of Franchisee or a professional or other advisor appointed on normal commercial terms is to be involved in the Franchised Business without the prior written consent of Franchisor. In addition, Franchisee must not sub-franchise, sublicense, subcontract, share, divide, or partition rights under this Agreement without Franchisor's prior written. Franchisor may in its absolute discretion withhold such consent.
2.6 Option for New Term
(1) Franchisor grants to Franchisee the option to:
(a) Operate as Franchisee in the Territory; and
(b) Enter into a new franchise agreement with Franchisor (based on Franchisor's thencurrent franchise agreement), for the New Term subject to the conditions set out in these clauses 2.6(1) to 2.6(4) (the Option).
(2) Franchisee must notify Franchisor in writing of its intention to exercise the Option not more than 12 Months and not less than 8 Months prior to the end of the Initial Term.
(3) Franchisee's Option pursuant to clause 2.6(2) is subject to all of the following conditions being satisfied:
(a) Franchisee has substantially complied with all material provisions of this Agreement throughout the Initial Term.
(b) At the date of giving Franchisor notice of its intention to exercise the Option and as at the end of the Initial Term, there is no outstanding breach of this Agreement or any Collateral Agreement which has not been remedied.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to the 2025 Chatime FDD, Item 23 Receipts includes information regarding the franchisee's obligations. Section 2.4, Development Obligations, states that the franchisee must faithfully, honestly, and diligently perform its obligations to open and operate the franchised business at the premises and continuously use its best efforts to promote and enhance the Chatime Network Name.
Section 2.5 discusses subcontracting, stating that the agreement is based on the direct and exclusive involvement of the Franchisee in the Franchised Business. Without prior written consent from Chatime, no person other than an employee of the Franchisee or a professional advisor can be involved in the Franchised Business. The Franchisee must also not sub-franchise, sublicense, subcontract, share, divide, or partition rights under this Agreement without Chatime's prior written consent, which Chatime may withhold at its discretion.
Section 2.6 outlines the option for a new term, stating that Chatime grants the Franchisee the option to operate in the territory and enter into a new franchise agreement with Chatime based on their current agreement for the New Term. To exercise this option, the Franchisee must notify Chatime in writing of its intention not more than 12 months and not less than 8 months prior to the end of the Initial Term. The option is subject to the conditions that the Franchisee has substantially complied with all material provisions of the agreement throughout the Initial Term and that there is no outstanding breach of the agreement or any Collateral Agreement that has not been remedied at the date of giving notice and at the end of the Initial Term.