During the Initial Term for a Chatime franchise, is the franchisee required to comply with all System Standards?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
4.3 System Standards
- (1) Franchisee agrees that at all times during the Initial Term, Franchisee will comply with all System Standards.
- (2) The System Standards may be periodically modified and supplemented by Franchisor in its discretion during the Initial Term. Franchisee must comply with any revised System Standards within 7 days of receipt of a notice from Franchisor advising of a change to the System Standards.
- (3) Franchisee agrees that System Standards prescribed from time to time in the Operations Manual, or otherwise communicated to Franchisee through the issue of Global Policies and Procedures, constitute provisions of this Agreement. Both parties agree and acknowledge that Franchisor does not intend to prescribe System Standards that affect the fundamental rights of Franchisee in this Agreement.
4.4 Compliance with the System
Franchisee agrees to diligently and continuously monitor compliance with the System and System Standards, to strictly enforce compliance with the System and System Standards by Franchisee and to furnish assistance to Franchisor to correct deficiencies in operation.
4.5 Franchise Premise
Franchisee must at all times during the Initial Term maintain office facilities for operation of the Franchise. Such office facilities will have a dedicated telephone line, which must be answered in the Network Name and will otherwise be equipped and furnished and have signage in a manner consistent with the image and minimum standards of Franchisor.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, franchisees must comply with all System Standards throughout the Initial Term of their franchise agreement. These System Standards can be modified and supplemented by Chatime at its discretion during the Initial Term. Franchisees are obligated to comply with any revisions to the System Standards within 7 days of receiving notice from Chatime about the changes.
The FDD specifies that System Standards are prescribed in the Operations Manual or communicated through Global Policies and Procedures, and they constitute provisions of the Franchise Agreement. Both Chatime and the franchisee acknowledge that Chatime does not intend to prescribe System Standards that affect the fundamental rights of the franchisee as outlined in the agreement.
Furthermore, the franchisee is responsible for diligently monitoring compliance with the System and System Standards. They must strictly enforce these standards and assist Chatime in correcting any operational deficiencies. This includes maintaining office facilities with a dedicated telephone line answered in the Network Name, equipped and furnished in a manner consistent with Chatime's image and minimum standards.