If the Developer receives the Acceptance Notice during the Offer Period, what are the obligations of both the Developer and Chatime?

According to Chatime's 2025 Franchise Disclosure Document, if the Developer receives the Acceptance Notice during the Offer Period, the Developer is obligated to sell, and Chatime is obligated to purchase the business. This transaction must occur under the terms and conditions outlined in the Offer Notice, potentially with variations specified in the Acceptance Notice.

The Acceptance Notice from Chatime to the Developer signifies Chatime's agreement to buy the business based on the terms initially proposed in the Offer Notice. However, Chatime retains the right to modify these terms in the Acceptance Notice, provided that the revised terms are not commercially less favorable to the Developer than the original offer. This ensures that the Developer is not put at a disadvantage if Chatime decides to exercise its right to purchase the business.

This clause protects Chatime's interests by allowing it to match a third-party offer, ensuring that the brand retains control over its network and development areas. For a prospective Chatime developer, this means that if they receive an offer to sell their development rights, they must first offer Chatime the opportunity to purchase those rights on similar terms. This could potentially delay or complicate a sale to a third party, as the developer must wait for Chatime to decide whether to exercise its right of first refusal.