When is the De-Branding Fee due to Chesters after the franchise agreement expires or is terminated?

According to Chesters's 2025 Franchise Disclosure Document, the De-Branding Fee is due if a franchisee does not comply with payment and restaurant-specific physical de-branding obligations within 14 business days after the franchise agreement expires or is terminated. The fee is $10,000, and payment is required via credit card or automatic debit.

This means that upon termination or expiration of the franchise agreement, a franchisee must promptly remove all Chesters branding from the restaurant location and fulfill any outstanding payment obligations. Failure to do so within the specified 14-business-day period will trigger the $10,000 De-Branding Fee.

The De-Branding Fee is intended to ensure that franchisees properly disassociate from the Chesters brand after the agreement ends, protecting the brand's image and preventing customer confusion. Franchisees should carefully review the de-branding requirements outlined in the franchise agreement to avoid incurring this fee. It is also important to note that Chesters requires the fee to be paid via credit card or automatic debit, so franchisees should be prepared to make payment through one of these methods.

It is common practice in the franchise industry to charge fees for non-compliance with post-termination obligations, such as de-branding. These fees are designed to protect the franchisor's brand and ensure a consistent experience for customers. Franchisees should be aware of these potential costs and plan accordingly when exiting the franchise system.