Must a Chesters franchisee promptly pay all monies due to Chesters and its affiliates after termination or expiration of the agreement?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
the parties are unable to mutually agree on a resolution within 45 days of entering into such discussions, we may terminate the Agreement effective immediately. In no case may an FME last more than 180 days.
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- Post-Term Obligations. When this Agreement expires or is terminated, you must immediately stop operating the Restaurant under the Chester's System and Marks; not thereafter represent to the public or hold yourself out as a present or former licensee of ours; immediately and permanently stop using any confidential methods, procedures, and techniques associated with the Chester's System and Marks; follow our instructions to de-identify the Restaurant from the Chester's System within the timeframe we specify; promptly pay all monies due to us and our affiliates; immediately deliver to us (at no cost to us) all Manuals, brochures, invoices, and other materials bearing the Marks. You will have 30 business days to show that you have completed all payment and Restaurant-specific physical de-branding obligations (the other obligations are immediate and continuing). If you fail to comply with the payment and Restaurant-specific physical de-branding obligations within 30 business days, you must pay us a $10,000 fee. Payment is due by credit card or ACH transfer. If you fail to comply with your de-branding obligations within the aforementioned timeframe, you agree to permit our third-party agent access to your premises to remove Chester's Marks from the Location. All of our and your (and your owners) obligations under this Agreement which expressly or by their
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, a franchisee must promptly pay all monies due to Chesters and its affiliates when the franchise agreement expires or is terminated. After the agreement ends, the franchisee must immediately stop operating under the Chesters system and marks and cease using any confidential methods associated with the system.
In addition to ceasing operations, the franchisee must follow Chesters' instructions to remove any branding that identifies the restaurant as a Chesters location within the specified timeframe. The franchisee is given 30 business days to complete all payment and restaurant-specific physical de-branding obligations. Other obligations, such as ceasing use of the Chesters system, are immediate and ongoing.
If the franchisee fails to meet the payment and de-branding obligations within the 30 business days, they will incur a $10,000 fee. Payment is required to be made via credit card or ACH transfer. Furthermore, if the de-branding obligations are not met within the specified timeframe, Chesters has the right to send a third-party agent to the premises to remove the Chesters marks at the franchisee's expense.
All obligations of both Chesters and the franchisee that, by their nature, are meant to survive the expiration or termination of the agreement will remain in full effect until they are completely fulfilled or naturally expire. This ensures that both parties continue to meet their responsibilities even after the formal agreement has ended.