What is the maximum duration an FME can last for a Chesters franchisee?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
In no case may an FME last more than 180 days.
The parties shall not be liable for any delay in or impairment of performance resulting in whole or in part from an event beyond the parties' reasonable control, including: natural disasters, fire, flood, severe weather, pandemic, disease epidemic, crop failure or lack of ingredients; embargoes, trade restrictions, or other acts of government; explosions, riots, wars, or acts of terrorism; strikes, lockouts, or labor disruptions; and shortages of transportation equipment, fuel, or labor (each, a "FME").
Notwithstanding anything to the contrary herein, if you are unable fulfill your obligations in this Agreement herein due to an FME, we agree to engage in good faith discussions to come to a mutually acceptable resolution; provided that if 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.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to the 2025 Chesters Franchise Disclosure Document, an FME (event beyond reasonable control) can last no more than 180 days. An FME is defined as an event beyond the parties' reasonable control, including natural disasters, fire, flood, severe weather, pandemic, disease epidemic, crop failure or lack of ingredients; embargoes, trade restrictions, or other acts of government; explosions, riots, wars, or acts of terrorism; strikes, lockouts, or labor disruptions; and shortages of transportation equipment, fuel, or labor.
If a Chesters franchisee is unable to fulfill their obligations due to an FME, Chesters agrees to engage in good faith discussions to find a mutually acceptable resolution. However, if the parties cannot agree on a resolution within 45 days of starting these discussions, Chesters has the right to terminate the Franchise Agreement immediately.
This clause provides some protection for franchisees facing unforeseen circumstances that disrupt their business operations. However, it also highlights the importance of maintaining open communication with Chesters and attempting to find a resolution quickly, as prolonged disruptions could lead to termination of the agreement. Franchisees should be aware of the potential risks associated with FMEs and consider business interruption insurance to mitigate potential losses.