What are the circumstances under which a Checkers franchisee would be responsible for indemnification fees to reimburse the franchisor's losses and expenses?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE | AMOUNT | DUE DATE | REMARKS (See Note 1) |
|---|---|---|---|
| Attorneys' Fees and other costs | Varies, actual fees and costs incurred | As incurred | Payable if you fail to comply with the Franchise Agreement of if we are joined in a lawsuit that is based on your operation of a restaurant. |
| Indemnification | Varies, actual losses and expenses incurred | As incurred | You must reimburse us for our losses and expenses as a result of third party claims arising from your failures or breaches under the Franchise Agreement, your operation of the Franchised Restaurant, and any unauthorized acts. |
Source: Item 6 — OTHER FEES (FDD pages 21–30)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, franchisees may be required to pay indemnification fees to reimburse Checkers for losses and expenses. These fees are incurred as a result of third-party claims.
Specifically, Checkers franchisees are responsible for indemnification if the claims arise from failures or breaches of the Franchise Agreement. This means if a franchisee violates the terms and conditions outlined in their agreement with Checkers, they may have to cover the resulting costs.
Additionally, indemnification is required if third-party claims stem from the franchisee's operation of the franchised restaurant or any unauthorized acts. The indemnification fees will vary based on actual losses and expenses incurred by Checkers and are due as incurred. This could include legal fees, settlement costs, or other damages resulting from the franchisee's actions or inactions.