Who qualifies as an 'Interested Party' as designated by Chatime?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
estrained Business; and
- (d) procure, employ, seek to employ or engage, or appoint in any capacity (whether as a consultant, director or otherwise), any person who is or has been in the 12 months
prior to such action an employee, independent contractor, or prospective franchisee of the Franchisor, its affiliates, or any Chatime Store Business.
(e) These restraints shall not apply to the Developer's or its affiliates' continued operation of individual Chatime Stores being operated under valid Franchise Agreement, which have not been terminated and are not in default.
7.3 Restraint Applies to Conduct in Any Capacity
The agreement by Developer Parties in clause 7.2 applies to any of them, the Interested Parties, and those acting:
- (1) In partnership or association with another person;
- (2) As principal, agent, representative, director, officer, employee, or financier;
- (3) As member, shareholder, debenture holder, note holder, or holder of any other security;
- (4) As trustee of or as a consultant or adviser to any person; or
- (5) In any other capacity.
7.4 Separate Restraint Agreements
Clauses 7.2 and 7.3 have effect as comprising each of the separate provisions which results from each combination of a capacity referred to in clause 7.3, a category of conduct referred to in clause 7.2, a geographical area specified in Schedule 1 and a period of time specified in Schedule 1.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the term 'Interested Parties' applies broadly to those affiliated with the Developer (which refers to an entity granted rights to develop Chatime franchises in a specific area). These parties are subject to certain restraints and obligations outlined in the agreement.
Specifically, the agreement applies to the Developer Parties, the Interested Parties, and those acting in various capacities such as partners, agents, representatives, directors, officers, employees, or financiers. It also includes those acting as members, shareholders, debenture holders, note holders, holders of any other security, trustees, consultants, or advisors to any person. This expansive definition ensures that a wide range of individuals and entities connected to the Developer are bound by the terms of the agreement.
Chatime also requires the Developer to ensure that its directors (who are not already party to the agreement), any Interested Party, manager, and key employees nominated by Chatime enter into confidentiality and non-competition agreements. These agreements must contain reasonable restraints similar to those imposed on the Developer. Furthermore, Chatime can require any Interested Party specified by them to enter into a non-compete and confidentiality agreement with Chatime, containing similar restraints and confidentiality obligations as those imposed on the Developer.