Which obligations are NOT suspended for the period of delay caused by a Force Majeure Event for Chatime?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
22 Force Majeure
- 22.1 A party (Affected Party) is not liable for any delay or failure to perform an obligation (other than to pay money) under this Agreement caused by:
- (1) Act of God;
- (2) War, terrorism, riot, insurrection, vandalism, or sabotage;
- (3) Strike, lockout, ban, limitation of work, or other industrial disturbance; or
- (4) Law, rule, or regulation of any government or governmental agency and executive or administrative order or act of general or particular application.
- 22.2 The Affected Party must notify each other party as soon as practical of any anticipated delay or failure caused by an event referred to in clause 22.1 (Event).
- 22.3 The performance of the Affected Party's obligation (other than to pay money) is suspended for the period of delay caused by the Event.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, a party's obligation to pay money is not suspended during a Force Majeure Event. A Force Majeure Event includes events such as acts of God, war, terrorism, riots, strikes, or changes in laws and regulations.
This means that even if a significant event occurs that disrupts the Chatime franchise's operations, the franchisee is still obligated to fulfill their monetary commitments to Chatime. This could include royalty payments, rent, or other fees outlined in the franchise agreement.
This clause protects Chatime's revenue stream even when franchisees are facing hardship due to unforeseen circumstances. Prospective franchisees should carefully consider this obligation and ensure they have sufficient financial resources to meet their payment obligations even during a Force Majeure Event. It is important to discuss with Chatime what options might be available in such a situation.