Under the Chatime franchise agreement, who is responsible for paying the costs or liabilities incurred by or on behalf of the Franchisor or the Attorney under clause 23?

According to Chatime's 2025 Franchise Disclosure Document, the Franchisee Parties are responsible for covering the costs or other liabilities incurred by or on behalf of Chatime or the Attorney under clause 23. This means that as a Chatime franchisee, you are obligated to pay for any costs or liabilities that Chatime or their appointed attorney incurs while acting on your behalf, particularly if you have not fulfilled your obligations under the franchise agreement.

Clause 23 of the Chatime franchise agreement grants Chatime and its officers the power of attorney to act on behalf of the franchisee to ensure compliance with the agreement. This includes the ability to execute documents, transfers, assignments, and other instruments related to Chatime's trademarks and website, at the franchisee's expense, if the franchisee fails to do so themselves.

This arrangement protects Chatime by ensuring that they can take necessary actions to maintain brand standards and fulfill obligations, even if a franchisee is non-compliant. However, it also places a financial burden on the franchisee, who must be prepared to cover these potentially unforeseen costs. It is important for prospective franchisees to understand the scope of these potential costs and liabilities and to factor them into their financial planning.