For Chatime franchisees, what obligation is suspended during a delay caused by an event described in clause 22.1?
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, if an event described in clause 22.1 occurs, the performance of the affected party's obligations, other than the obligation to pay money, is suspended for the duration of the delay caused by the event. Clause 22.1 lists specific events that qualify for this suspension of obligations. These events include acts of God, war, terrorism, riot, insurrection, vandalism, sabotage, strikes, lockouts, work limitations, industrial disturbances, or any law, rule, or regulation from a government or governmental agency.
This means that if a Chatime franchisee is unable to fulfill certain contractual obligations due to one of these events, they will not be held liable for the delay or failure to perform, as long as they notify the other party as soon as practical. However, it is important to note that the obligation to pay money is specifically excluded from this suspension. Franchisees must continue to meet their financial obligations to Chatime, even during a force majeure event.
This clause provides a degree of protection for Chatime franchisees facing unforeseen and uncontrollable circumstances. However, franchisees should be aware that this protection is not absolute. It is limited to the specific events listed in clause 22.1 and does not extend to financial obligations. Franchisees should carefully review this clause and consider how it might apply to their specific circumstances, especially regarding potential disruptions to their business operations. Understanding the scope and limitations of this clause is crucial for managing risk and ensuring compliance with the franchise agreement.