Does Chatime require the Developer and Guarantor to acknowledge they have relied on their own investigations and judgment when entering the agreement?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (3) Developer acknowledges and agrees that it has conducted an independent investigation of the business contemplated by this Agreement and recognizes that it involves business risks making the success of the venture largely dependent on the business abilities of Developer. Franchisor expressly disclaims the making of, and Developer acknowledges that it has not received or relied upon, any warranty or guarantee expressed or implied as to the potential volume, profits or success of the business venture contemplated by this Agreement.
- (4) Developer and Guarantor represent that all information provided to Franchisor in support of Developer's application to acquire the Development Business including in relation to its financial capacity, resources, business experience and skills are complete, true and correct.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the Developer acknowledges that they have conducted an independent investigation of the business contemplated by the agreement. The Developer also recognizes that the Chatime business venture involves risks and that the success of the venture is largely dependent on their own business abilities.
Chatime expressly disclaims making any warranties or guarantees, either expressed or implied, regarding the potential volume, profits, or success of the business venture. The Developer acknowledges that they have not relied upon any such warranty or guarantee from Chatime. This acknowledgement is a standard practice in franchising, intended to ensure that franchisees understand the risks involved and do not rely solely on the franchisor's projections.
Furthermore, the Developer and Guarantor represent that all information provided to Chatime in support of the Developer's application to acquire the Development Business, including information about financial capacity, resources, business experience, and skills, is complete, true, and correct. This representation reinforces the importance of providing accurate information to the franchisor during the application process.
This clause protects Chatime from potential claims that the franchisee was misled or relied on inaccurate information provided by the franchisor. It emphasizes that the franchisee is responsible for conducting their own due diligence and assessing the risks and opportunities associated with the Chatime franchise.