If a Chesters franchisee is unable to fulfill obligations due to an FME, what is the process for resolution?

According to Chesters's 2025 Franchise Disclosure Document, if a franchisee is unable to fulfill their obligations due to a Force Majeure Event (FME), Chesters agrees to engage in good faith discussions to find a mutually acceptable resolution. This indicates that Chesters is willing to work with franchisees facing unforeseen circumstances that prevent them from meeting their contractual duties.

However, if Chesters and the franchisee cannot agree on a resolution within 45 days of starting these discussions, Chesters has the right to terminate the Franchise Agreement immediately. This clause sets a time limit on negotiations and introduces the risk of termination if a resolution cannot be reached promptly. The FDD also stipulates that in no case may an FME last more than 180 days, meaning that the franchisee must resolve the issue within this time frame or face potential termination.

This process highlights the importance of clear communication and proactive problem-solving in the event of a Force Majeure Event. While Chesters commits to good faith discussions, the relatively short 45-day negotiation period and the 180-day overall limit place the onus on the franchisee to quickly address and resolve the issues caused by the FME. Prospective franchisees should carefully consider their ability to manage and recover from such events within these time constraints.