What is the 'New Term' defined as in the Chatime FDD?

According to the 2025 Chatime Franchise Disclosure Document, the 'New Term' is defined differently based on whether the franchisee is operating under a standard franchise agreement or a development agreement. For a standard franchisee, the 'New Term' refers to a period of ten years. This means that upon the expiration of the initial franchise term, a franchisee who meets the requirements for renewal has the option to enter into a new franchise agreement for an additional 10-year period.

For a Chatime developer, the 'New Term' is defined as the period starting at the end of the initial term and concluding at the end date of an agreed-upon Revised Development Schedule. This distinction is important because developers have different obligations and expansion plans compared to single-unit franchisees. The Revised Development Schedule likely outlines specific targets and timelines for opening new Chatime locations within the developer's designated territory.

Prospective franchisees and developers should carefully review their specific franchise or development agreement to understand the precise terms and conditions applicable to the 'New Term.' This includes understanding the requirements for exercising the option to renew or extend the agreement, as well as any associated fees or obligations. For franchisees in New York, it's important to note the amendment regarding the non-waiver provisions of the New York General Business Law, ensuring that their rights under Article 33 remain protected.