What are the obligations of a Chesters franchisee upon termination or non-renewal of the Franchise Agreement?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in franchise or other agreement | Summary | |
|---|---|---|---|
| i. | Franchisee's obligations on termination/ non-renewal | 20 of Agreement | Obligations include cease operating Restaurant and representing yourself as present or former franchisee; cease using confidential information, Marks, and trade dress; complete de-identification; and payment of amounts due. Also see (r) below. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 35–38)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, Item 17 outlines the franchisee's obligations upon termination or non-renewal of the franchise agreement. Specifically, the franchisee must cease operating the Restaurant and stop representing themselves as a current or former Chesters franchisee. This means they can no longer conduct business using the Chesters brand or imply any affiliation with the franchise.
Additionally, the franchisee is obligated to discontinue the use of any confidential information, Marks, and trade dress associated with Chesters. This includes recipes, operational manuals, logos, and any other proprietary information that gives Chesters its unique brand identity. The franchisee must also complete de-identification, which involves removing all Chesters branding from the restaurant location to ensure it no longer appears to be a Chesters establishment.
Finally, the franchisee is responsible for the payment of any outstanding amounts due to Chesters. These obligations are detailed in Section 20 of the Franchise Agreement. It is important for prospective franchisees to carefully review this section to fully understand their responsibilities upon termination or non-renewal, as failure to comply can result in legal and financial repercussions.