If Chesters assigns the EFA, will the assignee be subject to my claims against Chesters?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
We may sell, transfer, assign or encumber this EFA, in whole or in part, without notice to you or your consent.
You agree that if we sell, transfer, assign or encumber this EFA, the assignee will have the rights and benefits that we assign to the assignee and will not have to perform any of our obligations.
You agree that the rights of the assignee will not be subject to any claims, defenses or set-offs that you may have against us.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters' 2025 Franchise Disclosure Document, if Chesters sells, transfers, assigns, or encumbers the Equipment Finance Agreement (EFA), the assignee will acquire all of Chesters' rights and benefits under the agreement. However, the assignee will not be obligated to perform any of Chesters' duties or obligations outlined in the EFA.
Furthermore, the rights of the assignee will not be subject to any claims, defenses, or set-offs that the franchisee may have against Chesters. This means that if a franchisee has any grievances or disputes with Chesters, they cannot use those as a basis to challenge the assignee's rights or demand any compensation from them.
This clause protects the assignee's investment and ensures they receive the full benefits of the EFA without being encumbered by any prior issues between the franchisee and Chesters. For a prospective franchisee, this highlights the importance of resolving any disputes with Chesters promptly and understanding that any future claims against Chesters may not be applicable to the assignee if the EFA is transferred.