Does Checkers act as a trustee with respect to the Checkers National Production Fund (NPF)?

According to Checkers' 2025 Franchise Disclosure Document, Checkers does not act as a trustee or in any other fiduciary capacity with respect to the National Production Fund (NPF). This fund is used for marketing and advertising purposes. While Checkers administers the NPF, it explicitly states that it assumes no direct or indirect liability or obligation regarding its maintenance, direction, or administration, reinforcing that it does not act as a trustee.

Checkers retains significant control over the NPF. They have the right to use collection agents and institute legal proceedings to collect NPF contributions, and they may also forgive, waive, settle, and compromise claims by or against the NPF. Checkers can defer or reduce contributions from a restaurant and even reduce or suspend NPF contributions and operations with thirty days' notice. If the NPF is terminated, the unspent monies will be distributed to Checkers and Rally's franchisees, as well as to Checkers and its affiliates, in proportion to their contributions over the preceding twelve-month period.

This arrangement means that franchisees do not have the typical protections afforded by a formal trust. While Checkers is obligated to provide an annual statement of monies collected and costs incurred by the NPF upon written request, the lack of a fiduciary duty means franchisees have limited recourse if they disagree with how the funds are managed, as long as Checkers adheres to the general terms outlined in the franchise agreement. Prospective franchisees should carefully consider this aspect and seek clarification on the governance and oversight of the NPF to ensure they are comfortable with the level of control Checkers retains.