How does Chatime, as the Franchisor, provide notice of acceptance of the offer contained in the Offer Notice?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) Franchisor may accept the offer contained in the Offer Notice by giving notice of acceptance (Acceptance Notice) to Franchisee before the end of the Offer Period.
- (3) For the purpose of this clause 13.4, "Offer Period" means the period of 45 days after Franchisor receives the Offer Notice.
- (4) The Acceptance Notice may contain terms which vary the terms of the Offer Notice so long as the terms upon which Franchisor agrees to buy the Business are not commercially less favorable to Franchisee than those contained in the Offer Notice. For example, if the consideration, terms, and/or conditions offered by a third party are such that Franchisor is not reasonably able to furnish the same types of consideration, terms, and/or conditions, then Franchisor may purchase the interests proposed to be transferred for the reasonable equivalent in cash.
- (5) If Franchisee receives the Acceptance Notice during the Offer Period Franchisee must sell
and Franchisor must purchase the Business upon the terms and conditions contained in the Offer Notice as may be varied by the Acceptance Notice.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, Chatime may accept the offer included in the Offer Notice by providing an Acceptance Notice to the franchisee or developer before the Offer Period concludes. The Offer Period lasts for 45 days after Chatime receives the Offer Notice.
The Acceptance Notice from Chatime may include terms that differ from those in the Offer Notice, provided that the terms for Chatime to purchase the business are not commercially less favorable to the franchisee or developer than the original offer. For instance, if a third party's offer includes consideration, terms, or conditions that Chatime cannot reasonably match, Chatime can purchase the interests by offering a reasonable cash equivalent.
If the franchisee or developer receives the Acceptance Notice within the 45-day Offer Period, they are obligated to sell, and Chatime is obligated to purchase the business according to the terms and conditions outlined in the Offer Notice, as potentially modified by the Acceptance Notice. If Chatime does not accept the offer within the Offer Period, the franchisee or developer has 60 days after the Offer Period to sell the business to a third party, provided they comply with specific clauses and the sale terms are not more favorable to the third party than those in the Offer Notice.