Does Chatime franchisee consent to the franchisor assigning or novating any of its rights, interests, obligations, or liabilities under the Franchise Agreement?

According to Chatime's 2025 Franchise Disclosure Document, franchisees consent to Chatime assigning or novating their rights, interests, obligations, or liabilities under the Franchise Agreement. Specifically, the franchisee waives any requirement for prior notice of such actions. This means Chatime can transfer its responsibilities and benefits of the agreement to another party without needing the franchisee's explicit approval beforehand.

This consent is outlined in clause 12.5 of the franchise agreement. The franchisee is bound to acknowledge and agree to any assignment or novation initiated by Chatime. This includes executing any necessary deeds, agreements, or notices to formalize the assignment or novation. This clause also extends to actions outlined in clauses 12.1, 12.2, and 12.4, providing Chatime with broad latitude in restructuring or transferring its interests.

For a prospective Chatime franchisee, this clause signifies a lack of control over who their franchisor might become in the future. While Chatime retains the right to transfer the agreement, franchisees are obligated to comply with the transfer. It is important for potential franchisees to consider the implications of this lack of control and to evaluate Chatime's financial stability and long-term plans to mitigate any potential risks associated with future assignments or novations.