If I hold a debenture in another company, would Chatime consider that a partnership or association that needs to be disclosed?

According to the 2025 Chatime Franchise Disclosure Document, if you are a debenture holder in another company, Chatime may consider you to be acting in partnership or association with that company. Specifically, the franchise agreement states that certain restraints apply to those acting in partnership or association with another person, or as a member, shareholder, debenture holder, or holder of any other security. This means that as a prospective franchisee, your involvement with other entities as a debenture holder could trigger disclosure requirements and potentially subject you to certain obligations under the franchise agreement.

Chatime requires that these restraints apply to individuals acting in various capacities, including as a principal, agent, representative, director, officer, employee, or financier, and as a trustee or consultant. The agreement emphasizes that these restraints apply to conduct in any capacity, and each separate provision operates concurrently and independently. This broad application suggests that Chatime aims to prevent conflicts of interest and protect its business system by ensuring that franchisees and related parties are fully committed to the Chatime brand and do not engage in activities that could harm the franchise.

Therefore, if you hold a debenture in another company, Chatime may require you to disclose this relationship and ensure you enter into a non-compete and confidentiality agreement. This agreement would likely contain restraints similar to those imposed on the franchisee, preventing you from engaging in activities that compete with or otherwise harm the Chatime business. Prospective franchisees should carefully review these provisions and seek legal counsel to understand the full scope of these obligations and how they might affect their other business interests.