Did Chester Fried Licensed Restaurants pay a franchise fee to Chesters?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
Before the First Chester's began offering CHESTER'S Restaurant franchises on approximately March 1, 2004, our former affiliate, Giles Enterprises, Inc. ("Giles"), whose address was 2750 Gunter Park Drive West, Montgomery, Alabama 36121, licensed existing retail operators to operate quick-service chicken and sides restaurants similar to the Restaurant opportunity offered in our disclosure document in a program called the "CHESTER FRIED® Total Program" (the "Chester Fried Licensed Restaurants"). Giles began licensing operators to operate Chester Fried Licensed Restaurants in 1974; as of December 31, 2024, there were approximately 16 Operators of Chester Fried Licensed Restaurants remaining in the United States. Operators of Chester Fried Licensed Restaurants generally did not receive all the benefits of a CHESTER'S Restaurant franchise and also were not subject to all the same restrictions and obligations. For example, Chester Fried Licensed Restaurants did not pay a franchise or any other initial fee. Also, most Chester Fried Licensed Restaurants continue to operate under the "CHESTER FRIED®" name. We are now the licensor of those Chester Fried Licensed Restaurants. Operators of Chester Fried Licensed Restaurants have the right to convert their units to franchised Restaurants if they satisfy our standards for a CHESTER'S Restaurant franchisee. If they want to convert, they will sign our Agreement. There is no conversion agreement or similar document they must sign. In addition, in certain parts of the United States, we may continue allowing certain experienced foodservice operators, and chain accounts who already operate one or more Chester Fried Licensed
Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 8–12)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, Chester Fried Licensed Restaurants did not pay a franchise fee or any other initial fee. These restaurants, operating under a program called the "CHESTER FRIED® Total Program," were licensed by Giles Enterprises, Inc., a former affiliate of Chesters, beginning in 1974. As of December 31, 2024, approximately 16 of these licensed restaurants remained in the United States.
Chester Fried Licensed Restaurants differed significantly from franchised Chesters Restaurants. They generally did not receive the same benefits and were not subject to the same obligations as franchisees. This distinction extended to fees, as Chester Fried Licensed Restaurants were exempt from paying a franchise fee. However, the operators of Chester Fried Licensed Restaurants have the option to convert their units into franchised Restaurants if they meet Chesters' standards and sign the standard franchise agreement.
Chesters may continue to allow experienced foodservice operators and chain accounts to develop and operate additional Chester Fried Licensed Restaurants in certain parts of the United States. This exception typically occurs when these operators prefer not to acquire a full Chesters Restaurant franchise for their own business reasons. While these licensed restaurants may compete with franchised locations, Chesters focuses primarily on granting CHESTER'S Restaurant franchises and CHESTER'S Licensed Restaurants.