Can Chesters change the manuals, standards, specifications, and operating procedures without a signed modification to the franchise agreement?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
e_0.jpeg)
| Provision | Section in franchise or other agreement | Summary | |
|---|---|---|---|
| d. | Termination by franchisee | Not Applicable | You have no contractual right to terminate the Agreement. However, you have the right to terminate the Agreement on any grounds available under applicable state law. |
| e. | Termination by franchisor without cause | Not Applicable | We have no right to terminate your Agreement without cause. |
| f. | Termination by franchisor with cause | 18 and 19 of Agreement | We have right to terminate only if you breach the Agreement. |
| g. | "Cause" defined – curable defaults | 19 of Agreement | You generally have 20 days to cure all defaults that by their nature can be cured. |
| h. | "Cause" defined – non-curable defaults | 11, 18, and 19 of Agreement | Unapproved transfers and third failed in- Restaurant inspection are not curable defaults. |
| i. | Franchisee's obligations on termination/ non-renewal | 20 of Agreement | Obligations include cease operating Restaurant and representing yourself as present or former franchisee; cease using confidential information, Marks, and trade dress; complete de-identification; and payment of amounts due. Also see (r) below. |
| j. | Assignment of contract by franchisor | 18 of Agreement | No restriction on our right to assign; we have the right to assign without your approval. |
| k. | "Transfer" by franchisee – defined | 18 of Agreement | Includes transfer of Agreement, your controlling ownership interest, and your actual management control. |
| 1. | Franchisor approval of transfer by franchisee | 18 of Agreement | You have no right to transfer without our prior written consent, which we have the right to grant or withhold as we deem best. |
| m. | Conditions for franchisor approval of transfer | 18 of Agreement | The Agreement does not specify any transfer conditions you must satisfy; we have the right to grant or withhold approval of a proposed transfer as we deem best. |
| n. | Franchisor's right of first refusal to acquire franchisee's business | Not Applicable | The Agreement does not contain this right. |
| 0. | Franchisor's option to purchase franchisee's business | Not Applicable | The Agreement does not contain this right. |
| p. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 35–38)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, Chesters has the ability to unilaterally modify certain operational aspects of the franchise without requiring a signed agreement from the franchisee. Specifically, Chesters can change the manuals, standards, specifications, and operating procedures.
This provision in the franchise agreement means that Chesters franchisees must stay informed of any changes Chesters makes to these key operational areas. These changes are binding even without the franchisee's explicit consent or signature. This is a fairly common practice in franchising, as it allows the franchisor to maintain brand consistency and adapt to changing market conditions or updated best practices.
For a prospective franchisee, this highlights the importance of carefully reviewing the franchise agreement and understanding the scope of changes Chesters can implement. While such changes are intended to improve the system, they could also potentially increase operating costs or require adjustments to the franchisee's business practices. It would be prudent for a potential franchisee to discuss with existing franchisees how Chesters has historically managed changes to manuals and operating procedures.