What constitutes an unauthorized transfer of the Checkers franchise that could lead to termination?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 13.01 Franchisor's Approval. The rights and duties created by this Agreement are personal to you or, if you are a business corporation, partnership, limited liability company or other legal entity, your Owners. Accordingly, neither you nor any of your Owners may transfer the Franchise without our approval and without complying with all of the provisions of Section 13. Any transfer without such approval or compliance constitutes a breach of this Agreement and is void and of no force or effect.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, the franchise agreement is personal to the franchisee and their owners. Therefore, neither the franchisee nor their owners can transfer the franchise without Checkers's approval and compliance with all provisions outlined in Section 13 of the agreement. Any transfer that occurs without this required approval or compliance is considered a breach of the agreement, making the transfer void and without any legal effect.
This means that a Checkers franchisee cannot simply sell or hand over their franchise to someone else without first getting the green light from Checkers. This approval process is in place to ensure that any new franchisee meets Checkers's standards and is capable of upholding the brand's reputation and operational requirements. The conditions for approval are designed to protect Checkers's interests and ensure the continued success of the franchise system.
For a prospective Checkers franchisee, this highlights the importance of understanding the transfer conditions outlined in Section 13 of the franchise agreement. If a franchisee wishes to sell their Checkers business in the future, they must adhere to the proper procedures to avoid breaching the agreement and potentially facing termination. This includes obtaining Checkers's approval and ensuring that all requirements are met, which may involve financial qualifications, operational experience, and other criteria deemed necessary by Checkers.