For Chatime franchise payments, how are payments calculated and converted into US dollars for remittance to the franchisor?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
6.8 Currency of Payment
- (1) All payments by Franchisee to Franchisor under this Agreement will be made in U.S. Dollars unless otherwise specified by Franchisor.
- (2) All payments in this Agreement are to be calculated in the currency of the Territory and converted into Dollars for payment to Franchisor and must be converted at a rate equivalent to the measurement notified by Franchisor on the date the payment is due. However, in the event a payment is remitted after the date payment is due, the currency exchange rate used will be the rate as of:
- (a) The date the payment was due; or
- (b) The date the payment is remitted,
whichever rate is the greater.
(3) All payments from Franchisee to Franchisor under this Agreement must be made in full, net of any bank charges, by direct deposit into Franchisor's bank account as specified in Section 7 of Schedule 1, or in such other manner as Franchisor notifies Franchisee in writing, including direct debit from Franchisee's bank or credit account. Franchisee must
execute any forms or documents required by Franchisor in order to give effect to payments by way of direct debit or any other electronic method.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, all payments to Chatime must be made in U.S. dollars unless Chatime specifies otherwise. However, the initial calculation of these payments is to be done in the currency of the territory where the Chatime franchise is located. The conversion to U.S. dollars for remittance to Chatime must be at the exchange rate that Chatime notifies as being in effect on the payment due date.
If a franchisee remits payment after its due date, the currency exchange rate used will be the greater of either the rate on the original due date or the rate on the actual date the payment is remitted. This condition incentivizes franchisees to make timely payments to avoid potentially higher conversion costs due to currency fluctuations.
Chatime requires all payments to be made in full, without any deductions for bank charges. Payments are to be made via direct deposit into Chatime's specified bank account, or through other methods Chatime may specify in writing, including direct debit. Franchisees are required to complete any necessary documentation to facilitate payments via direct debit or other electronic methods. This ensures that Chatime receives the full amount due and has control over the payment methods used by franchisees.