Under the Chatime agreement, what are the Developer Parties required to do regarding costs or liabilities incurred by or on behalf of the Franchisor or the Attorney under clause 21?

According to Chatime's 2025 Franchise Disclosure Document, clause 21 pertains to the Power of Attorney granted to Chatime to ensure the Developer fulfills their obligations under the agreement. Specifically, the Developer Parties are obligated to cover all costs or other liabilities incurred by or on behalf of Chatime or the Attorney acting on Chatime's behalf under this clause. This means that if Chatime, through its appointed Attorney, needs to take actions to ensure the Developer complies with the agreement, the Developer is responsible for paying all associated costs.

This requirement places a financial responsibility on the Chatime Developer Parties to ensure they adhere to the franchise agreement. Should they fail to meet their obligations, leading Chatime to exercise its power of attorney, the Developer Parties will be liable for any resulting expenses. These expenses could include legal fees, administrative costs, or any other liabilities incurred during the process of enforcing the agreement.

For a prospective Chatime franchisee, this underscores the importance of fully understanding and complying with all aspects of the franchise agreement. Failure to do so could result in not only the initial breach but also the added financial burden of covering Chatime's costs to rectify the situation. This clause serves as a strong incentive for Developer Parties to proactively meet their contractual obligations and maintain open communication with Chatime to avoid potential disputes and associated costs.